R |
Annual
report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of
1934
|
£ |
Transition
report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of
1934
|
Delaware
|
38-0549190
|
|||
(State
of incorporation)
|
(I.R.S.
employer identification no.)
|
|||
One
American Road, Dearborn, Michigan
|
48126
|
|||
(Address
of principal executive offices)
|
(Zip
code)
|
Title
of each class
|
Name
of each exchange on which registered(a)
|
|
Common
Stock, par value $.01 per share
|
New
York Stock Exchange
|
|
Pacific
Stock Exchange
|
||
7.50%
Notes Due June 10, 2043
|
New
York Stock Exchange
|
|
Ford
Motor Company Capital Trust II
|
New
York Stock Exchange
|
|
6.50%
Cumulative Convertible Trust Preferred
|
||
Securities,
liquidation preference $50 per share
|
(a) |
In
addition, shares of Common Stock of Ford are listed on certain stock
exchanges in Europe.
|
Document
|
Where
Incorporated
|
|
Proxy
Statement*
|
Part
III (Items 10, 11, 12, 13 and 14)
|
* |
As
stated under various Items of this Report, only certain specified
portions
of such document are incorporated by reference in this
Report.
|
Exhibit
Index begins on page 69
|
·
|
Transactions
that we designated as fair value hedges involved interest rate swaps
hedging the back-end of debt instruments or involved longer-than-normal
settlement periods.
|
·
|
We
paid or received fees when entering into a derivative contract or
upon
changing counterparties.
|
·
|
Interest
rate swaps included terms that did not exactly match the terms of
the
debt, including prepayment optionality.
|
Net
Income/(Loss)
|
Retained
Earnings
|
||||||||||||||||||
2005
|
2004
|
2003
|
2002
|
2001
|
At
December 31, 2000
|
||||||||||||||
Previously
reported
|
$
|
2,024
|
$
|
3,487
|
$
|
495
|
$
|
(980
|
)
|
$
|
(5,453
|
)
|
$
|
17,884
|
|||||
Pre-tax
adjustments:
|
|||||||||||||||||||
Fair
value interest rate swaps
|
(873
|
)
|
(769
|
)
|
(990
|
)
|
2,588
|
1,077
|
—
|
||||||||||
Out-of-period
adjustments
|
(44
|
)
|
25
|
565
|
384
|
(124
|
)
|
(868
|
)
|
||||||||||
Total
pre-tax adjustments
|
(917
|
)
|
(744
|
)
|
(425
|
)
|
2,972
|
953
|
(868
|
)
|
|||||||||
Related
tax effects - provision for/(benefit from)
|
(333
|
)
|
(295
|
)
|
(169
|
)
|
1,117
|
287
|
(239
|
)
|
|||||||||
Net
after-tax adjustments
|
(584
|
)
|
(449
|
)
|
(256
|
)
|
1,855
|
666
|
(629
|
)
|
|||||||||
Restated
|
$
|
1,440
|
$
|
3,038
|
$
|
239
|
$
|
875
|
$
|
(4,787
|
)
|
$
|
17,255
|
·
|
Automotive
revenue recognition: As disclosed in Note 2 of the Notes to the Financial
Statements, vehicle sales are generally recorded when shipped. In
the late
1990s, we determined that vehicles sold in the UK did not meet the
criteria for revenue recognition at the time of shipment. We had
previously judged the impact of this practice to be immaterial to
any
individual period. Beginning in 2001 and continuing through 2003,
as we
launched new vehicles, we amended our UK dealer contracts to transfer
all
risks of ownership to our dealers at the time of vehicle shipment.
As part
of the restatement, we have changed the periods in which revenue was
recognized for these UK vehicles from shipment to the subsequent
period
when risk of ownership was transferred. As part of our restatement,
we
recognized additional pre-tax income/(loss) of $246 million, $156
million,
and $52 million in 2003, 2002, and 2001,
respectively.
|
·
|
Financial
Services revenue recognition: We recorded out-of-period adjustments
to
revenue primarily associated with our operating lease contracts in
order to reflect earnings on a straight-line basis rather than an
effective-interest rate method and corrected the accounting related
to the amortization of certain loan origination costs involving
securitized assets. As part of our restatement, we recognized additional
pre-tax income/(loss) of $(115) million, $63 million, $59 million,
$280 million, and $(27) million in 2005, 2004, 2003, 2002, and 2001,
respectively.
|
·
|
Employee-benefit
related expenses: We recorded out-of-period adjustments in 2001 related
to
the improper initial adoption of SFAS No. 87,
Employers'
Accounting for Pensions
by
certain foreign affiliates (two consolidated and one unconsolidated).
We
also recorded an out-of-period adjustment primarily related to
special termination packages offered outside of our normal separation
programs that were not recognized as employees separated, but when
paid.
As part of our restatement, we recognized additional pre-tax
income/(loss) of $83 million, $(5) million, $(54) million,
$(9) million, and $107 million in 2005, 2004, 2003, 2002, and 2001,
respectively.
|
·
|
Marketing
incentives: We recorded out-of-period adjustments primarily to correct
duplicative reserves for vehicle residual values and for certain
employee
and supplier discount plans that were recognized at point of retail
sale
rather than when we sold the vehicle to the dealer. As part of our
restatement, we recognized additional pre-tax income/(loss) of
$(11) million, $(9) million, $128 million,
$49 million, and $(139) million in 2005, 2004, 2003, 2002, and 2001,
respectively.
|
·
|
Marketing
expenses: We recorded an out-of-period adjustment to record marketing
costs (advertising and sales promotions) that had been accrued prior
to services being rendered. As part of our restatement, we recognized
additional pre-tax income/(loss) of $(107) million and $1 million
in 2004
and 2003, respectively.
|
· |
In
addi
t
ion
to the items listed above, during the affected periods we also
recorded
many other less-signifcant out-of-period adjustments, which totaled
$(1)
million, $83 million, $185 million, $(92) million, and $(117)
million in
2005, 2004, 2003, 2002, and 2001, respectively. Nearly all of
these
adjustments were recorded in
Cost of
sales.
|
•
|
"Investor
Information"
|
•
|
"Company
Reports"
|
•
|
"U.S.
S.E.C. EDGAR"
|
•
|
"Click
here to continue on to view SEC
Filings"
|
Business
Sector
|
Reportable
Segments
|
Description
|
Automotive:
|
The
Americas
|
Primarily
includes the sale of Ford, Lincoln and Mercury brand vehicles and
related
service parts in North America (the United States, Canada and Mexico)
and
Ford-brand vehicles and related service parts in South America; in
each
case, together with the associated costs to design, develop, manufacture
and service these vehicles and parts.
|
Ford
Europe and
Premier
Automotive Group
|
Primarily
includes the sale of Ford-brand vehicles and related service parts
in
Europe and Turkey and the sale of Premier Automotive Group ("PAG")
brand
vehicles (i.e., Volvo, Jaguar, Land Rover and Aston Martin) and related
service parts throughout the world (including North and South America,
Asia Pacific and Africa); in each case, together with the associated
costs
to design, develop, manufacture and service these vehicles and
parts.
|
|
Ford
Asia Pacific and
Africa/Mazda
|
Primarily
includes the sale of Ford-brand vehicles and related service parts
in the
Asia Pacific region and South Africa, together with the associated
costs
to design, develop, manufacture and service these vehicles and parts,
and
our share of the results of Mazda Motor Corporation (of which we
own
approximately 33.4%) and certain of our Mazda-related
investments.
|
|
Financial
Services:
|
Ford
Motor Credit Company
|
Primarily
includes vehicle-related financing, leasing, and
insurance.
|
Brand
|
Number
of Dealerships
at
December 31, 2005*
|
Ford
|
10,134
|
Mercury
|
1,971
|
Lincoln
|
1,422
|
Volvo
|
2,400
|
Land
Rover
|
1,400
|
Jaguar
|
880
|
Aston
Martin
|
125
|
*
|
Because
many of these dealerships distribute more than one of our brands
from the
same sales location, a single dealership may be counted under more
than
one brand.
|
•
|
unit
sales volume;
|
•
|
the
mix of vehicles and options sold;
|
•
|
the
margin of profit on each vehicle sold;
|
•
|
the
level of "incentives" (e.g., price discounts) and other marketing
costs;
|
•
|
the
costs for customer warranty claims and additional service actions;
and
|
•
|
the
costs for safety, emission and fuel economy technology and
equipment.
|
|
U.S.
Industry Sales
|
|||||||||||||||
|
Years
Ended December 31,
|
|||||||||||||||
|
2005
|
2004
|
2003
|
2002
|
2001
|
|||||||||||
(millions
of units)
|
||||||||||||||||
Cars
|
7.7
|
7.5
|
7.6
|
8.1
|
8.4
|
|||||||||||
Trucks
|
9.8
|
9.8
|
9.4
|
9.0
|
9.1
|
|||||||||||
Total
|
17.5
|
17.3
|
17.0
|
17.1
|
17.5
|
U.S.
Industry Vehicle Mix of Sales
by
Segment
|
||||||||||||||||
Years
Ended December 31,
|
||||||||||||||||
2005
|
2004
|
2003
|
2002
|
2001
|
||||||||||||
CARS
|
||||||||||||||||
Small
|
16.7
|
%
|
15.9
|
%
|
16.4
|
%
|
17.3
|
%
|
18.4
|
%
|
||||||
Medium
|
12.6
|
13.6
|
14.8
|
15.6
|
15.8
|
|||||||||||
Large
|
7.0
|
6.3
|
6.1
|
6.9
|
7.1
|
|||||||||||
Premium
|
7.7
|
7.6
|
7.6
|
7.5
|
6.9
|
|||||||||||
Total
U.S. Industry Car Sales
|
44.0
|
43.4
|
44.9
|
47.3
|
48.2
|
|||||||||||
TRUCKS
|
||||||||||||||||
Compact
Pickup
|
3.9
|
%
|
4.0
|
%
|
4.4
|
%
|
4.7
|
%
|
5.1
|
%
|
||||||
Bus/Van
|
8.2
|
8.2
|
8.0
|
8.6
|
8.7
|
|||||||||||
Full-Size
Pickup
|
14.5
|
14.6
|
14.0
|
13.1
|
13.4
|
|||||||||||
Sport
Utility Vehicles
|
26.7
|
27.6
|
27.0
|
24.9
|
23.0
|
|||||||||||
Medium/Heavy
|
2.7
|
2.2
|
1.7
|
1.4
|
1.6
|
|||||||||||
Total
U.S. Industry Truck Sales
|
56.0
|
56.6
|
55.1
|
52.7
|
51.8
|
|||||||||||
Total
U.S. Industry Vehicle Sales
|
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
|
Ford
Vehicle Mix of Sales
by
Segment in U.S.
|
|||||||||||||||
|
Years
Ended December 31,
|
|||||||||||||||
|
2005
|
2004
|
2003
|
2002
|
2001
|
|||||||||||
CARS
|
||||||||||||||||
Small
|
10.9
|
%
|
10.2
|
%
|
11.4
|
%
|
12.5
|
%
|
14.0
|
%
|
||||||
Medium
|
7.7
|
8.8
|
10.4
|
11.9
|
11.5
|
|||||||||||
Large
|
8.3
|
5.0
|
4.8
|
4.4
|
5.2
|
|||||||||||
Premium
|
5.9
|
6.6
|
7.0
|
7.8
|
7.0
|
|||||||||||
Total
Ford U.S. Car Sales
|
32.8
|
30.6
|
33.6
|
36.6
|
37.7
|
|||||||||||
TRUCKS
|
||||||||||||||||
Compact
Pickup
|
3.8
|
%
|
4.7
|
%
|
6.0
|
%
|
6.2
|
%
|
6.9
|
%
|
||||||
Bus/Van
|
8.4
|
8.8
|
8.4
|
9.1
|
9.1
|
|||||||||||
Full-Size
Pickup
|
28.4
|
28.2
|
24.3
|
22.5
|
22.9
|
|||||||||||
Sport
Utility Vehicles
|
26.1
|
27.4
|
27.5
|
25.4
|
23.2
|
|||||||||||
Medium/Heavy
|
0.5
|
0.3
|
0.2
|
0.2
|
0.2
|
|||||||||||
Total
Ford U.S. Truck Sales
|
67.2
|
69.4
|
66.4
|
63.4
|
62.3
|
|||||||||||
Total
Ford U.S. Vehicle Sales
|
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
|
U.S.
Car Market Shares*
|
|||||||||||||||
|
Years
Ended December 31,
|
|||||||||||||||
|
2005
|
2004
|
2003
|
2002
|
2001
|
|||||||||||
Ford
|
6.0
|
%
|
5.9
|
%
|
6.9
|
%
|
7.7
|
%
|
8.6
|
%
|
||||||
General
Motors
|
10.0
|
10.9
|
11.5
|
12.1
|
13.0
|
|||||||||||
DaimlerChrysler
|
4.0
|
3.8
|
3.8
|
4.1
|
4.1
|
|||||||||||
Toyota
|
7.4
|
6.4
|
5.9
|
5.8
|
5.5
|
|||||||||||
Honda
|
4.8
|
4.9
|
4.8
|
4.9
|
5.1
|
|||||||||||
Nissan
|
3.3
|
3.1
|
3.0
|
2.5
|
2.4
|
|||||||||||
All
Other**
|
8.5
|
8.4
|
9.0
|
10.2
|
9.5
|
|||||||||||
Total
U.S. Car Retail Deliveries
|
44.0
|
%
|
43.4
|
%
|
44.9
|
%
|
47.3
|
%
|
48.2
|
%
|
|
U.S.
Truck Market Shares*
|
|||||||||||||||
|
Years
Ended December 31,
|
|||||||||||||||
|
2005
|
2004
|
2003
|
2002
|
2001
|
|||||||||||
Ford
|
12.2
|
%
|
13.4
|
%
|
13.6
|
%
|
13.4
|
%
|
14.2
|
%
|
||||||
General
Motors
|
15.8
|
16.2
|
16.4
|
16.2
|
15.0
|
|||||||||||
DaimlerChrysler
|
10.5
|
10.3
|
10.0
|
10.0
|
10.1
|
|||||||||||
Toyota
|
5.6
|
5.5
|
5.1
|
4.5
|
4.5
|
|||||||||||
Honda
|
3.6
|
3.2
|
3.1
|
2.4
|
1.8
|
|||||||||||
Nissan
|
2.9
|
2.6
|
1.7
|
1.5
|
1.7
|
|||||||||||
All
Other**
|
5.4
|
5.4
|
5.2
|
4.7
|
4.5
|
|||||||||||
Total
U.S. Truck Retail Deliveries
|
56.0
|
%
|
56.6
|
%
|
55.1
|
%
|
52.7
|
%
|
51.8
|
%
|
|
U.S.
Combined Car and Truck
Market
Shares*
|
|||||||||||||||
|
Years
Ended December 31,
|
|||||||||||||||
|
2005
|
2004
|
2003
|
2002
|
2001
|
|||||||||||
Ford
|
18.2
|
%
|
19.3
|
%
|
20.5
|
%
|
21.1
|
%
|
22.8
|
%
|
||||||
General
Motors
|
25.8
|
27.1
|
27.9
|
28.3
|
28.0
|
|||||||||||
DaimlerChrysler
|
14.5
|
14.1
|
13.8
|
14.1
|
14.2
|
|||||||||||
Toyota
|
13.0
|
11.9
|
11.0
|
10.3
|
10.0
|
|||||||||||
Honda
|
8.4
|
8.1
|
7.9
|
7.3
|
6.9
|
|||||||||||
Nissan
|
6.2
|
5.7
|
4.7
|
4.4
|
4.1
|
|||||||||||
All
Other**
|
13.9
|
13.8
|
14.2
|
14.5
|
14.0
|
|||||||||||
Total
U.S. Car and Truck Retail Deliveries
|
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
* |
All
U.S. retail sales data are based on publicly available information
from
the media and trade publications.
|
** |
"All
Other" includes primarily companies based in Korea, other Japanese
manufacturers and various European manufacturers, and, with respect
to the
U.S. Truck Market Shares table and U.S. Combined Car and Truck Market
Shares table, includes heavy truck
manufacturers.
|
|
Ford
Fleet Sales
|
|||||||||||||||
|
Years
Ended December 31,
|
|||||||||||||||
|
2005
|
2004
|
2003
|
2002
|
2001
|
|||||||||||
Daily
Rental Units
|
450,000
|
429,000
|
444,000
|
459,000
|
465,000
|
|||||||||||
Commercial
and Other Units
|
263,000
|
248,000
|
227,000
|
252,000
|
295,000
|
|||||||||||
Government
Units
|
141,000
|
133,000
|
124,000
|
123,000
|
143,000
|
|||||||||||
Total
Fleet Units
|
854,000
|
810,000
|
795,000
|
834,000
|
903,000
|
|||||||||||
Percent
of Ford’s total U.S. car and truck sales
|
27
|
%
|
24
|
%
|
23
|
%
|
23
|
%
|
23
|
%
|
|
Industry
Volumes
(in
thousands)
|
Corporate
Market Share
|
||||||||||||||||||||
|
2005
|
2004
|
2005
Over/(Under)
2004
|
2005
|
2004
|
2005
Over/(Under)
2004
|
||||||||||||||||
Australia
|
988
|
955
|
33
|
3
|
%
|
13.8
|
%
|
14.9
|
%
|
(1.1)
pts.
|
||||||||||||
South
Africa
|
565
|
450
|
115
|
26
|
%
|
11.0
|
%
|
10.5
|
%
|
0.5
pts.
|
||||||||||||
Taiwan
|
514
|
484
|
30
|
6
|
%
|
11.2
|
%
|
11.0
|
%
|
0.2
pts.
|
||||||||||||
Thailand
|
700
|
626
|
74
|
12
|
%
|
3.5
|
%
|
4.2
|
%
|
(0.7)
pts.
|
||||||||||||
Japan
|
5,852
|
5,853
|
(1
|
)
|
0
|
%
|
*
|
*
|
*
|
*
|
Our
combined car and truck market share in Japan has been less than 1%
in
recent years.
|
•
|
Retail
financing.
Purchasing retail installment sales contracts and retail lease contracts
from dealers, and offering financing to commercial customers, primarily
vehicle leasing companies and fleet purchasers, to purchase or lease
vehicle fleets;
|
•
|
Wholesale
financing.
Making loans to dealers to finance the purchase of vehicle inventory,
also
known as floorplan financing; and
|
•
|
Other
financing.
Making loans to dealers for working capital, improvements to dealership
facilities, and the acquisition and refinancing of dealership real
estate.
|
|
Years
Ended
December
31,
|
|||||||||
|
2005
|
2004
|
2003
|
|||||||
United
States
|
||||||||||
Financing
share - Ford, Lincoln and Mercury
|
||||||||||
Retail
installment and lease
|
37
|
%
|
45
|
%
|
39
|
%
|
||||
Wholesale
|
81
|
84
|
85
|
|||||||
Europe
|
||||||||||
Financing
share - Ford
|
||||||||||
Retail
installment and lease
|
28
|
%
|
29
|
%
|
31
|
%
|
||||
Wholesale
|
96
|
97
|
97
|
|
2005
|
2004*
|
|||||
Business
Unit
|
|||||||
Automotive
|
|||||||
The
Americas
|
|||||||
Ford
North America
|
140
|
126
|
|||||
Ford
South America
|
13
|
12
|
|||||
Ford
Europe and PAG
|
|||||||
Ford
Europe
|
66
|
69
|
|||||
PAG
|
49
|
51
|
|||||
Ford
Asia Pacific and Africa
|
18
|
18
|
|||||
Financial
Services
|
|||||||
Ford
Motor Credit Company
|
14
|
18
|
|||||
The
Hertz Corporation
|
-
|
31
|
|||||
Total
|
300
|
325
|
*
|
Employment
figures for 2004 have been adjusted to conform to 2005 business unit
presentation.
|
|
2005
|
2004
|
|||||
Earnings
|
$
|
31.64
|
$
|
30.93
|
|||
Benefits
|
33.26
|
32.00
|
|||||
Total
|
$
|
64.90
|
$
|
62.93
|
Segment
|
Plants
|
Distribution
Centers/Warehouses
|
Engineering,
Research/Development
|
Sales
Offices
|
|||||||||
The
Americas
|
61
|
33
|
41
|
38
|
|||||||||
Ford
Europe and PAG
|
38
|
11
|
9
|
27
|
|||||||||
Ford
Asia Pacific and Africa/Mazda
|
14
|
3
|
2
|
5
|
|||||||||
Total
|
113
|
47
|
52
|
70
|
•
|
AutoAlliance
International ("AAI")
—
a
50/50 joint venture with Mazda (of which we own approximately 33.4%),
which operates as its principal business an automobile vehicle assembly
plant in Flat Rock, Michigan. AAI currently produces the Mazda6 and
Ford
Mustang models. Ford supplies all of the hourly and substantially
all of
the salaried labor requirements to AAI, and AAI reimburses Ford for
the
full cost of that labor.
|
•
|
Ford
Otosan
—
a
joint venture in Turkey between Ford (41% partner), the Koc Group
of
Turkey (41% partner) and public investors (18%) that is our single
source
supplier of the Ford Transit Connect vehicle and our sole distributor
of
Ford vehicles in Turkey. In addition, Ford Otosan makes the Ford
Transit
series and the Cargo truck for the Turkish and export markets, and
certain
engines and transmissions, most of which are under license. This
joint
venture owns and operates two plants and a parts distribution depot
in
Turkey.
|
•
|
Getrag
Ford Transmissions GmbH
—
a
50/50 joint venture with Getrag Deutsche Venture GmbH and Co. KG,
a German
company, to which we transferred our European manual transmission
operations in Halewood, England; Cologne, Germany; and Bordeaux,
France.
In 2004, Volvo Car Corporation ("Volvo Cars") agreed to transfer
its
manual transmission operations from its Köping, Sweden plant to this joint
venture. The Getrag joint venture produces manual transmissions for
our
operations in Europe (Ford Europe and PAG). Ford currently supplies
most
of the hourly and salaried labor requirements of the operations
transferred to this Getrag joint venture. Ford employees who worked
at the
manual transmission operations transferred at the time of formation
of the
joint venture are assigned to the joint venture by Ford. In the event
of
surplus labor at the joint venture, Ford employees assigned to the
joint
venture may return to Ford. Employees hired in the future to work
in these
operations will be employed directly by the joint venture. Getrag
Ford
Transmissions GmbH reimburses Ford for the full cost of the hourly
and
salaried labor supplied by Ford. This joint venture operates three
plants.
|
•
|
Getrag
All Wheel Drive AB
—
a
joint venture in Sweden between Getrag Dana Holding GmbH ("Getrag/Dana")
(60% partner) and Volvo Cars (40% partner). In January 2004, Volvo
Cars
entered into agreements with Getrag/Dana to transfer Volvo Cars'
plant in
Köping, Sweden to this joint venture. The joint venture produces all-wheel
drive components and, for a time, chassis components as well. As
noted
above, the manual transmission operations at the Köping plant were
transferred to Getrag Ford Transmissions GmbH. The hourly and salaried
employees at the plant have become employees of the joint venture.
|
•
|
TEKFOR
Cologne GmbH
("TEKFOR")
—
a
50/50 joint venture of Ford-Werke GmbH ("Ford-Werke") together with
Neumayer Tekfor GmbH, a German company, to which Ford-Werke transferred
the operations of the Ford forge in Cologne. The joint venture produces
forged components, primarily for transmissions and chassis, for use
in
Ford vehicles and for sale to third parties. Those Ford employees
who
worked at the Cologne Forge Plant at the time of the formation of
the
joint venture are assigned to TEKFOR by Ford and remain Ford employees.
In
the event of surplus labor at the joint venture, Ford employees assigned
to TEKFOR may return to Ford. New workers at the joint venture will
be
hired as employees of the joint venture. TEKFOR reimburses Ford for
the
full cost of Ford employees assigned to the joint venture. This joint
venture operates one plant.
|
•
|
Pininfarina
Sverige, AB
—
a
joint venture between Volvo Cars (40% partner) and Pininfarina, S.p.A.
("Pininfarina") (60% partner). In September 2003, Volvo Cars entered
into
agreements with Pininfarina to establish this joint venture for the
engineering and manufacture of niche vehicles, starting with a new,
small
convertible. Volvo Cars has outsourced the design and engineering
to
Pininfarina. The joint venture began production of the new car at
the
Uddevalla Plant in Sweden, which was transferred from Volvo Cars
to the
joint venture in December 2005, and is the joint venture's only plant.
|
•
|
Ford
Vietnam Limited
—
a
joint venture between Ford (75% partner) and Song Cong Diesel (25%
partner). Ford Vietnam assembles and distributes several Ford vehicles
in
Vietnam, including Escape, Everest, Focus, Mondeo, Ranger and Transit.
This joint venture operates one plant.
|
•
|
Ford
Lio Ho Motor Company Ltd. ("FLH")
—
a
joint venture in Taiwan among Ford (70% partner), the Lio Ho Group
(25%
partner) and individual shareholders (5% ownership in aggregate)
that
assembles a variety of Ford and Mazda vehicles sourced from Ford
as well
as Mazda and Suzuki. In addition to domestic assembly, FLH also has
local
product development capability to modify vehicle designs for local
needs,
and imports Ford-brand built-up vehicles from Europe and the United
States. This joint venture operates one plant.
|
•
|
AutoAlliance
(Thailand) ("AAT")
—
a
joint venture among Ford (50%), Mazda (45%) and a Thai affiliate
of
Mazda's (5%), which owns and operates a manufacturing plant in Rayong,
Thailand. AAT produces the Ford Everest, Ford Ranger and Mazda B-Series
pickup trucks for the Thai market and for export to over 100 countries
worldwide (other than North America), in both built-up and kit form.
|
•
|
Blue
Diamond Truck, S de RL de CV
—
a
joint venture between Ford (49% partner) and International Truck
and
Engine Corporation (51% partner), a subsidiary of Navistar International
Corporation ("Navistar"). Blue Diamond Truck develops and manufactures
selected medium and light commercial trucks in Mexico and sells the
vehicles to Ford and Navistar for their own independent distribution.
Blue
Diamond Truck manufactures Ford F-650/750 medium-duty commercial
trucks
that are sold in the United States and Canada, and Navistar medium-duty
commercial trucks that are sold in Mexico. Production of a
low-cab-forward, light-/medium-duty commercial truck for each of
Ford and
Navistar began in May 2005.
|
•
|
Tenedora
Nemak, S.A. de C.V.
—
a
joint venture between Ford (15% partner) and a subsidiary of Mexican
conglomerate Alfa S.A. de C.V. (85% partner), which owns and operates,
among other facilities, our former Canadian castings operations,
and
supplies engine blocks and heads to several of our engine plants.
Ford
supplies a portion of the hourly labor requirements for the Canadian
plants, for which it is fully reimbursed by the joint venture.
|
•
|
Changan
Ford Automobile Corporation, Ltd. ("Changan Ford")
—
a
50/50 joint venture between Ford and the Chongqing Changan Automobile
Co.,
Ltd. ("Changan"). Through its facility in the Chinese city of Chongqing,
Changan Ford produces and distributes in China the Ford Fiesta, Mondeo
and
Focus, and is planning to launch Mazda3 vehicles in 2006. In 2005,
Changan
Ford received approval from the Chinese government for the establishment
of a new vehicle manufacturing plant in the Chinese city of Nanjing,
which
is now under construction. Changan Ford has also filed an application
with
the Chinese government to reorganize its current equity structure
as
follows: Changan 50%, Ford 35% and Mazda 15%. Upon completion of
such
equity reorganization, Changan Ford would change its corporate name
to
Changan Ford Mazda Automobile Co., Ltd.
|
•
|
Changan
Ford Mazda Engine Company, Ltd. ("CFME")
—
a
joint venture between Ford (25% partner), Mazda (25% partner) and
the
Chongqing Changan Automobile Co., Ltd (50% partner). CFME is located
in
the City of Nanjing, and will produce the Ford New I4 and Mazda BZ
engines
in support of the assembly of Ford- and Mazda-branded vehicles
manufactured in China.
|
•
|
Jiangling
Motors Corporation, Ltd. ("JMC")
—
a
publicly-traded company in China with Ford (30% shareholder) and
Jiangxi
Jiangling Holdings, Ltd. (41% shareholder) as its controlling
shareholders. Jiangxi Jiangling Holdings, Ltd. is a 50/50 joint venture
between Chongqing Changan Automobile Co., Ltd. and Jiangling Motors
Company Group. The public investors of JMC own 29% of its outstanding
shares. JMC assembles the Ford Transit van and other
non-Ford-technology-based vehicles for distribution in China.
|
•
|
Ford
Malaysia Sdn. Bhd.
—
a
joint venture between Ford (49% partner) and Tractors Malaysia, a
publicly-traded subsidiary of Sime Darby (51% partner). Ford Malaysia
distributes Ford vehicles assembled by its wholly-owned subsidiary
Associated Motor Industries Malaysia, Sdn. Bhd., an assembly company,
including Econovan, Escape, Everest, Laser and Ranger.
|
Name
|
|
Position
|
|
Present
Position
Held
Since
|
|
Age
|
William
Clay Ford, Jr. (a)
|
Chairman
of the Board and Chief Executive Officer
|
October
2001
|
48
|
|||
James
J. Padilla (b)
|
President
and Chief Operating Officer
|
February
2005
|
59
|
|||
Lewis
W. K. Booth
|
Executive
Vice President - Ford Europe and Premier Automotive Group and Chairman,
Ford Europe, Jaguar and Land Rover
|
October
2005
|
57
|
|||
Mark
Fields
|
Executive
Vice President - President, The Americas
|
October
2005
|
45
|
|||
Donat
R. Leclair, Jr.
|
Executive
Vice President and Chief Financial Officer
|
August
2003
|
54
|
|||
Mark
A. Schulz
|
Executive
Vice President - President, International Automotive
Operations
|
October
2005
|
53
|
|||
Anne
L. Stevens
|
Executive
Vice President - Chief Operating Officer, The Americas
|
November
2005
|
57
|
|||
Michael
E. Bannister
|
Group
Vice President - Chairman and Chief Executive Officer,
Ford
Motor Credit Company
|
April
2004
|
56
|
|||
Francisco
Codina
|
Group
Vice President - North America Marketing, Sales and
Service
|
March
2006
|
54
|
|||
John
Fleming
|
Group
Vice President - President and Chief Executive Officer,
Ford
Europe
|
October
2005
|
55
|
|||
Derrick
M. Kuzak
|
Group
Vice President - Product Development, The Americas
|
November
2005
|
54
|
|||
Joe
W. Laymon
|
Group
Vice President - Corporate Human Resources and Labor
Affairs
|
October
2003
|
53
|
|||
J
C. Mays
|
Group
Vice President - Design, and Chief Creative Officer
|
August
2003
|
51
|
|||
Ziad
S. Ojakli
|
Group
Vice President - Corporate Affairs
|
January
2004
|
38
|
|||
Richard
Parry-Jones
|
Group
Vice President - Global Product Development and
Chief
Technical Officer
|
August
2001
|
54
|
|||
David
T. Szczupak
|
Group
Vice President - Manufacturing, The Americas
|
November
2005
|
50
|
|||
David
G. Leitch
|
Senior
Vice President and General Counsel
|
April
2005
|
45
|
|||
James
C. Gouin
|
Vice
President and Controller
|
August
2003
|
46
|
(a)
|
Also
Chair of the Office of the Chairman and Chief Executive Committee,
and a
member of the Finance Committee and of the Environmental and Public
Policy
Committee of the Board of
Directors.
|
(b)
|
Also
a member of the Office of the Chairman and Chief Executive Committee
of
the Board of Directors.
|
•
|
Mr.
Ojakli served as Principal Deputy for Legislative Affairs for President
George W. Bush from December 2002 to 2003, and was Deputy Assistant
to the
President from 2001 to 2002. Prior to that, from 1998 to 2000, he
was the
Policy Director and Chief of Staff to the Senate Republican Conference
Secretary.
|
•
|
Mr.
Leitch served as the Deputy Assistant and Deputy Counsel to President
George W. Bush from December 2002 to March 2005. From June 2001 until
December 2002, he served as Chief Counsel for the Federal Aviation
Administration, overseeing a staff of 290 in Washington and the agency's
11 regional offices. Prior to June 2001, Mr. Leitch was a partner
at Hogan
& Hartson LLP in Washington DC, where his practice focused on
appellate litigation in state and federal court.
|
2004
|
2005
|
||||||||||||||||||||||||
|
First
Quarter
|
Second
Quarter
|
Third
Quarter
|
Fourth
Quarter
|
First
Quarter
|
Second
Quarter
|
Third
Quarter
|
Fourth
Quarter
|
|||||||||||||||||
Common
Stock price per share*
|
|||||||||||||||||||||||||
High
|
$
|
17.34
|
$
|
16.48
|
$
|
15.77
|
$
|
15.00
|
$
|
14.75
|
$
|
11.69
|
$
|
11.19
|
$
|
10.00
|
|||||||||
Low
|
12.75
|
13.00
|
13.61
|
12.61
|
10.94
|
9.07
|
9.55
|
7.57
|
|||||||||||||||||
Dividends
per share of Common and Class B Stock
|
$
|
0.10
|
$
|
0.10
|
$
|
0.10
|
$
|
0.10
|
$
|
0.10
|
$
|
0.10
|
$
|
0.10
|
$
|
0.10
|
Period
|
Total
Number
of
Shares
Purchased*
|
Average
Price
Paid
per
Share
|
Total
Number of
Shares
Purchased
as
Part of Publicly
Announced
Plans
or
Programs
|
Maximum
Number
(or
Approximate Dollar Value)
of
Shares that May Yet Be
Purchased
Under the
Plans
or Programs
|
|||||||||
Oct.
1, 2005 through Oct. 31, 2005
|
2,289,994
|
$
|
8.82
|
0
|
No publicly announced repurchase program in place | ||||||||
Nov.
1, 2005 through Nov. 30, 2005
|
2,183,656
|
$
|
8.15
|
0
|
No publicly announced repurchase program in place | ||||||||
Dec.
1, 2005 through Dec. 31, 2005
|
2,494,720
|
$
|
8.10
|
0
|
No publicly announced repurchase program in place | ||||||||
Total
|
6,968,370
|
$
|
8.35
|
0
|
*
|
We
currently do not have a publicly announced repurchase program in
place. Of
the 6,968,370 shares purchased, 6,954,640 shares were purchased from
the
Ford Motor Company Savings and Stock Investment Plan for Salaried
Employees ("SSIP") and the Tax Efficient Savings Plan for Hourly
Employees
("TESPHE"). Shares are generally purchased from SSIP and TESPHE when
participants in those plans elect to sell units in the Ford Stock
Fund
upon retirement, upon termination of employment with the Company,
related
to an in-service distribution, or to fund a loan against an existing
account balance in the Ford Stock Fund. Shares are not purchased
from
these plans when a participant transfers account balances out of
the Ford
Stock Fund and into another investment option under the plans. For
the
full year 2005, we purchased 25,823,410 shares on such basis from
participants in SSIP and TESPHE. The remaining shares were acquired
from
our employees or directors in accordance with our various compensation
plans as a result of share withholdings to pay income taxes with
respect
to: (i) the lapse of restrictions on restricted stock, (ii) the issuance
of unrestricted stock, including issuances as a result of the conversion
of restricted stock equivalents, or (iii) to pay the exercise price
and related income taxes with respect to certain exercises of stock
options.
|
Net
Income/(Loss)
|
Retained
Earnings
|
||||||||||||
2005
|
2004
|
2003
|
At
December 31,
2002
|
||||||||||
Previously
reported
|
$
|
2,024
|
$
|
3,487
|
$
|
495
|
$
|
8,659
|
|||||
Pre-tax
adjustments:
|
|||||||||||||
Fair
value interest rate swaps
|
(873
|
)
|
(769
|
)
|
(990
|
)
|
3,665
|
||||||
Out-of-period
adjustments
|
(44
|
)
|
25
|
565
|
(608
|
)
|
|||||||
Total
pre-tax adjustments
|
(917
|
)
|
(744
|
)
|
(425
|
)
|
3,057
|
||||||
Related
tax effects - provision for/(benefit from)
|
(333
|
)
|
(295
|
)
|
(169
|
)
|
1,165
|
||||||
Net
after-tax adjustments
|
(584
|
)
|
(449
|
)
|
(256
|
)
|
1,892
|
||||||
Restated
|
$
|
1,440
|
$
|
3,038
|
$
|
239
|
$
|
10,551
|
Restated
|
||||||||||
|
2005
|
2004
|
2003
|
|||||||
Income/(loss)
before income taxes
|
||||||||||
Automotive
sector
|
$
|
(3,874
|
)
|
$
|
(178
|
)
|
$
|
(1,387
|
)
|
|
Financial
Services sector
|
4,953
|
4,287
|
2,301
|
|||||||
Total
Company
|
1,079
|
4,109
|
914
|
|||||||
Provision
for/(benefit from) income taxes (a)
|
(845
|
)
|
643
|
(46
|
)
|
|||||
Minority
interests in net income/(loss) of subsidiaries (b)
|
280
|
282
|
314
|
|||||||
Income/(loss)
from continuing operations
|
1,644
|
3,184
|
646
|
|||||||
Income/(loss)
from discontinued operations
|
47
|
(146
|
)
|
(143
|
)
|
|||||
Cumulative
effect of change in accounting principle (c)
|
(251
|
)
|
—
|
(264
|
)
|
|||||
Net
income/(loss)
|
$
|
1,440
|
$
|
3,038
|
$
|
239
|
(a)
|
See
Note 3 of the Notes to the Financial Statements for disclosure regarding
2005 effective tax rate.
|
(b)
|
Primarily
related to Ford Europe's consolidated less-than-100%-owned
affiliates.
|
(c)
|
See
Notes 17 and 27 of the Notes to the Financial
Statements.
|
2005
|
2004
|
2003
|
||||||||
Automotive
Sector
|
||||||||||
Ford
North America
|
||||||||||
Visteon-related
charges *
|
$
|
(468
|
)
|
$
|
(600
|
)
|
$
|
(1,597
|
)
|
|
Personnel-reduction
programs
|
(401
|
)
|
—
|
—
|
||||||
Fuel-cell
technology charges
|
(116
|
)
|
(182
|
)
|
—
|
|||||
Changes
in state non-income tax law
|
85
|
—
|
—
|
|||||||
Divestiture
of non-core business (Beanstalk Group, LLC)
|
(59
|
)
|
—
|
—
|
||||||
Ford
Europe
|
||||||||||
Personnel-reduction
programs
|
(510
|
)
|
(49
|
)
|
(513
|
)
|
||||
Premier
Automotive Group ("PAG")
|
||||||||||
Jaguar/Land
Rover impairment
|
(1,300
|
)
|
—
|
—
|
||||||
Personnel-reduction
programs
|
(245
|
)
|
(110
|
)
|
—
|
|||||
Ford
Asia Pacific and Africa
|
||||||||||
Divestiture
of non-core business (certain Australia dealerships)
|
14
|
(81
|
)
|
—
|
||||||
Personnel-reduction
programs
|
(33
|
)
|
—
|
—
|
||||||
Other
Automotive
|
||||||||||
Divestiture
of non-core businesses (primarily related to Kwik-Fit Group
Limited)
|
152
|
17
|
49
|
|||||||
Total
Automotive sector
|
(2,881
|
)
|
(1,005
|
)
|
(2,061
|
)
|
||||
Financial
Services Sector
|
||||||||||
Divestiture
of non-core business (The Hertz Corporation ("Hertz"))
|
1,499
|
—
|
—
|
|||||||
Property
clean-up settlement
|
—
|
45
|
—
|
|||||||
Total
|
$
|
(1,382
|
)
|
$
|
(960
|
)
|
$
|
(2,061
|
)
|
Restated
|
||||||||||
|
Income/(Loss)
Before
Income
Taxes
|
|||||||||
|
2005
|
2004
|
2005
Over/
(Under)
2004
|
|||||||
The
Americas
|
||||||||||
—
Ford North America
|
$
|
(2,444
|
)
|
$
|
525
|
$
|
(2,969
|
)
|
||
—
Ford South America
|
399
|
144
|
255
|
|||||||
Total
The Americas
|
(2,045
|
)
|
669
|
(2,714
|
)
|
|||||
Ford
Europe and PAG
|
||||||||||
—
Ford Europe
|
(437
|
)
|
177
|
(614
|
)
|
|||||
—
PAG
|
(1,634
|
)
|
(830
|
)
|
(804
|
)
|
||||
Total
Ford Europe and PAG
|
(2,071
|
)
|
(653
|
)
|
(1,418
|
)
|
||||
Ford
Asia Pacific and Africa/Mazda
|
||||||||||
—
Ford Asia Pacific and Africa
|
42
|
(36
|
)
|
78
|
||||||
—
Mazda and Associated Operations
|
255
|
118
|
137
|
|||||||
Total
Ford Asia Pacific and Africa/Mazda
|
297
|
82
|
215
|
|||||||
Other
Automotive
|
(55
|
)
|
(276
|
)
|
221
|
|||||
Total
Automotive sector
|
$
|
(3,874
|
)
|
$
|
(178
|
)
|
$
|
(3,696
|
)
|
Restated
|
|||||||||||||||||||||||||
|
Sales
(in
billions)
|
Vehicle
Unit Sales (a)
(in
thousands)
|
|||||||||||||||||||||||
|
2005
|
2004
|
2005
Over/(Under)
2004
|
2005
|
2004
|
2005
Over/(Under)
2004
|
|||||||||||||||||||
The
Americas
|
|||||||||||||||||||||||||
—
Ford North America
|
$
|
80.6
|
$
|
83.0
|
$
|
(2.4
|
)
|
(3
|
)%
|
3,443
|
3,623
|
(180
|
)
|
(5
|
)%
|
||||||||||
—
Ford South America
|
4.4
|
3.0
|
1.4
|
43
|
336
|
292
|
44
|
15
|
|||||||||||||||||
Total
The Americas
|
85.0
|
86.0
|
(1.0
|
)
|
(1
|
)
|
3,779
|
3,915
|
(136
|
)
|
(3
|
)
|
|||||||||||||
Ford
Europe and PAG
|
|||||||||||||||||||||||||
—
Ford Europe
|
29.9
|
26.5
|
3.4
|
13
|
1,785
|
1,705
|
80
|
5
|
|||||||||||||||||
—
PAG
|
30.3
|
27.6
|
2.7
|
10
|
757
|
771
|
(14
|
)
|
(2
|
)
|
|||||||||||||||
Total
Ford Europe and PAG
|
60.2
|
54.1
|
6.1
|
11
|
2,542
|
2,476
|
66
|
3
|
|||||||||||||||||
Ford
Asia Pacific and Africa/Mazda
|
|||||||||||||||||||||||||
—
Ford Asia Pacific and Africa (b)
|
7.7
|
7.0
|
0.7
|
10
|
465
|
407
|
58
|
14
|
|||||||||||||||||
—
Mazda and Associated Operations (c)
|
0.6
|
—
|
0.6
|
—
|
32
|
—
|
32
|
—
|
|||||||||||||||||
Total
Ford Asia Pacific and Africa/Mazda
|
8.3
|
7.0
|
1.3
|
19
|
497
|
407
|
90
|
22
|
|||||||||||||||||
Total
Automotive sector
|
$
|
153.5
|
$
|
147.1
|
$
|
6.4
|
4
|
6,818
|
6,798
|
20
|
—
|
(a)
|
Vehicle
unit sales generally are reported on a where-sold basis, and include
sales
of all Ford-badged units and units manufactured by Ford and sold
to other
manufacturers, as well as units distributed for other manufacturers.
Vehicles sold to daily rental car companies that are returned to
us
pursuant to a guaranteed repurchase option and vehicles used in our
own
fleet (including management evaluation vehicles) are included in
vehicle
unit sales at the time they are disposed of by us through used car
channels. 2005 vehicle unit sales include about 50,000 units transferred
to Hertz which were still being used in Hertz operations as of the
date we
sold Hertz; "sales" above does not include revenue from these
units.
|
(b)
|
Included
in vehicle unit sales of Ford Asia Pacific and Africa are Ford-badged
vehicles sold in China and Malaysia by certain unconsolidated affiliates
totaling about 87,000 and 66,000 units in 2005 and 2004, respectively.
"Sales" above does not include revenue from these
units.
|
(c)
|
Reflects
sales of Mazda6 by our consolidated subsidiary, AutoAlliance
International, Inc. ("AAI"), beginning with the consolidation of
AAI in
the third quarter of 2005. See Note 17 of the Notes to the Financial
Statements.
|
Market
Share
|
Dealer-Owned
Stocks (a)
(in
thousands)
|
|||||||||||||||||||
Market
|
2005
|
2004
|
2005
Over/(Under)
2004
|
2005
|
2004
|
2005
Over/(Under)
2004
|
||||||||||||||
U.S.
(b)
|
17.0
|
%
|
18.0
|
%
|
(1.0)
|
pts. |
733
|
794
|
(61
|
)
|
||||||||||
Brazil
(b)
|
12.4
|
11.8
|
0.6
|
18
|
19
|
(1
|
)
|
|||||||||||||
Europe
(b) (c)
|
8.5
|
8.6
|
(0.1
|
)
|
342
|
356
|
(14
|
)
|
||||||||||||
PAG
- U.S./Europe (c)
|
1.2/2.3
|
1.3/2.3
|
(0.1)/0
|
45/69
|
41/68
|
4/1
|
||||||||||||||
Australia
(b)
|
13.1
|
14.2
|
(1.1
|
)
|
18
|
19
|
(1
|
)
|
(a)
|
Dealer-owned
stocks represent our estimate of vehicles shipped to our customers
(dealers) and not yet sold by the dealers to their retail customers,
as
well as some vehicles reflected in our
inventory.
|
(b)
|
Includes
only Ford and, in the United States, Lincoln and Mercury
brands.
|
(c)
|
European
market share is based, in part, on estimated 2005 vehicle registrations
for our 19 major European markets.
|
Restated
|
|||||||
Explanation
of Cost Performance
|
2005
Costs*
Better/(Worse)
than
2004
|
||||||
Net
product costs
|
New
product and commodities-related cost increases, offset partially
by
pricing reductions from
our
suppliers and design cost reductions on existing products.
|
$
|
(0.9
|
)
|
|||
|
|||||||
Pension
and health care
|
Primarily
the effect of lower discount rates
|
(0.7
|
)
|
||||
Quality-related
|
Warranty
performance on prior model-year vehicles, offset partially by cost
recoveries from suppliers(including Bridgestone-Firestone North American
Tire, LLC)
|
(0.4
|
)
|
||||
Depreciation
and amortization
|
Primarily
related to investments for new vehicles and acceleration of depreciation
in a number
of
our operations
|
(0.3
|
)
|
||||
Overhead
|
Primarily
reductions in salaried personnel.
|
0.4
|
|||||
Manufacturing
and engineering
|
Primarily
hourly and salaried personnel reductions and ongoing
efficiencies
in our plants.
|
0.8
|
|||||
|
Total
|
$
|
(1.1
|
)
|
*
|
At
constant volume, mix and exchange and excluding special items and
discontinued operations
.
|
Restated
|
||||||||||
|
Income/(Loss)
Before
Income
Taxes
|
|||||||||
|
2004
|
2003
|
2004
Over/(Under)
2003
|
|||||||
The
Americas
|
||||||||||
—
Ford North America
|
$
|
525
|
$
|
446
|
$
|
79
|
||||
—
Ford South America
|
144
|
(129
|
)
|
273
|
||||||
Total
The Americas
|
669
|
317
|
352
|
|||||||
Ford
Europe and PAG
|
||||||||||
—
Ford Europe
|
177
|
(1,317
|
)
|
1,494
|
||||||
—
PAG
|
(830
|
)
|
139
|
(969
|
)
|
|||||
Total
Ford Europe and PAG
|
(653
|
)
|
(1,178
|
)
|
525
|
|||||
Ford
Asia Pacific and Africa/Mazda
|
||||||||||
—
Ford Asia Pacific and Africa
|
(36
|
)
|
(23
|
)
|
(13
|
)
|
||||
—
Mazda and Associated Operations
|
118
|
69
|
49
|
|||||||
Total
Ford Asia Pacific and Africa/Mazda
|
82
|
46
|
36
|
|||||||
Other
Automotive
|
(276
|
)
|
(572
|
)
|
296
|
|||||
Total
Automotive sector
|
$
|
(178
|
)
|
$
|
(1,387
|
)
|
$
|
1,209
|
Restated
|
|||||||||||||||||||||||||
|
Sales
(in
billions)
|
Vehicle
Unit Sales (a)
(in
thousands)
|
|||||||||||||||||||||||
|
2004
|
2003
|
2004
Over/(Under)
2003
|
2004
|
2003
|
2004
Over/(Under)
2003
|
|||||||||||||||||||
The
Americas
|
|||||||||||||||||||||||||
—
Ford North America
|
$
|
83.0
|
$
|
83.6
|
$
|
(0.6
|
)
|
(1
|
)%
|
3,623
|
3,810
|
(187
|
)
|
(5
|
)%
|
||||||||||
—
Ford South America
|
3.0
|
1.9
|
1.1
|
58
|
292
|
210
|
82
|
39
|
|||||||||||||||||
Total
The Americas
|
86.0
|
85.5
|
0.5
|
1
|
3,915
|
4,020
|
(105
|
)
|
(3
|
)
|
|||||||||||||||
Ford
Europe and PAG
|
|||||||||||||||||||||||||
—
Ford Europe
|
26.5
|
23.2
|
3.3
|
14
|
1,705
|
1,682
|
23
|
1
|
|||||||||||||||||
—
PAG
|
27.6
|
24.9
|
2.7
|
11
|
771
|
754
|
17
|
2
|
|||||||||||||||||
Total
Ford Europe and PAG
|
54.1
|
48.1
|
6.0
|
12
|
2,476
|
2,436
|
40
|
2
|
|||||||||||||||||
Ford
Asia Pacific and Africa/Mazda
|
|||||||||||||||||||||||||
—
Ford Asia Pacific and Africa (b)
|
7.0
|
5.8
|
1.2
|
21
|
407
|
353
|
54
|
15
|
|||||||||||||||||
—
Mazda and Associated Operations
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||||||
Total
Ford Asia Pacific and Africa/Mazda
|
7.0
|
5.8
|
1.2
|
21
|
407
|
353
|
54
|
15
|
|||||||||||||||||
Other
Automotive
|
|||||||||||||||||||||||||
Total
Automotive sector
|
$
|
147.1
|
$
|
139.4
|
$
|
7.7
|
6
|
6,798
|
6,809
|
(11
|
)
|
—
|
(a)
|
Vehicle
unit sales generally are reported on a where-sold basis, and include
sales
of all Ford-badged units and units manufactured by Ford and sold
to other
manufacturers, as well as units distributed for other manufacturers.
Vehicles sold to daily rental car companies that are returned to
us
pursuant to a guaranteed repurchase option and vehicles used in our
own
fleet (including management evaluation vehicles) are included in
vehicle
unit sales at the time they are disposed of by us through used car
channels.
|
(b)
|
Included
in vehicle unit sales of Ford Asia Pacific and Africa are Ford-badged
vehicles sold in China and Malaysia by certain unconsolidated affiliates
totaling about 66,000 and 34,000 units in 2004 and 2003, respectively.
"Sales" above does not include revenue from these
units.
|
Market
Share
|
Dealer-Owned
Stocks (a)
(in
thousands)
|
|||||||||||||||||||
Market
|
2004
|
2003
|
2004
Over/(Under)
2003
|
2004
|
2003
|
2004
Over/(Under)
2003
|
||||||||||||||
U.S.
(b)
|
18.0
|
%
|
19.2
|
%
|
(1.2)
|
pts. |
794
|
791
|
3
|
|||||||||||
Brazil
(b)
|
11.8
|
11.5
|
0.3
|
19
|
12
|
7
|
||||||||||||||
Europe
(b) (c)
|
8.7
|
8.6
|
0.1
|
356
|
403
|
(47
|
)
|
|||||||||||||
PAG
- U.S./Europe (c)
|
1.3/2.3
|
1.3/2.1
|
0/
0.2
|
41/68
|
47/59
|
(6)/9
|
||||||||||||||
Australia
(b)
|
14.2
|
13.9
|
0.3
|
19
|
18
|
1
|
(a)
|
Dealer-owned
stocks represent our estimate of vehicles shipped to our customers
(dealers) and not yet sold by the dealers to their retail customers,
as
well as some vehicles reflected in our
inventory.
|
(b)
|
Includes
only Ford and, in the United States, Lincoln and Mercury
brands.
|
(c)
|
European
market share is based on vehicle registrations for our 19 major European
markets.
|
Restated
|
||||||||||
Income/(Loss)
Before
Income Taxes
|
||||||||||
2005
|
2004
|
2005
Over/(Under)
2004
|
||||||||
Ford
Credit
|
$
|
2,923
|
$
|
3,710
|
$
|
(787
|
)
|
|||
Hertz
operating results (a)
|
974
|
493
|
481
|
|||||||
Other
Financial Services operating results
|
(39
|
)
|
84
|
(123
|
)
|
|||||
Gain
on sale of Hertz (b)
|
1,095
|
—
|
1,095
|
|||||||
Total
Financial Services sector
|
$
|
4,953
|
$
|
4,287
|
$
|
666
|
(a)
|
Includes
amortization expense related to intangibles recognized upon consolidation
of Hertz.
|
(b)
|
The
segment presentation of the gain on sale of Hertz in Note 24 of the
Notes
to the Financial Statements is $1,006 million in the Hertz segment
and $89
million in Other Financial
Services.
|
•
|
On-balance
sheet basis
.
Includes the receivables Ford Credit owns and receivables sold for
legal
purposes that remain on Ford Credit's balance
sheet;
|
•
|
Securitized
off-balance sheet basi
s.
Includes receivables sold in securitization transactions that are
not
reflected on Ford Credit's balance
sheet;
|
•
|
Managed
basis
.
Includes on-balance sheet and securitized off-balance sheet receivables
that Ford Credit continues to service;
and
|
•
|
Serviced
basis
.
Includes managed receivables and receivables sold in whole-loan sale
transactions where Ford Credit retains no interest in the sold
receivables, but which it continues to
service.
|
*
|
At
December 31, 2005 and December 31, 2004, finance receivables of $44.7
billion and $16.9 billion, respectively, have been sold for legal
purposes
to consolidated securitization special purpose entities ("SPEs").
In
addition, at December 31, 2005, and December 31, 2004, interests
in
operating leases and the related vehicles of $6.5 billion and $2.5
billion, respectively, have been transferred for legal purposes to
consolidated securitization SPEs. These receivables and interests
in
operating leases and the related vehicles are available only for
repayment
of debt issued by those entities, and to pay other securitization
investors and other participants; they are not available to pay Ford
Credit's other obligations or the claims of Ford Credit's other
creditors.
|
|
2005
|
2004
|
2005
Over/(Under)
2004
|
|||||||
Charge-offs
(in millions)
|
||||||||||
On-Balance
Sheet
|
||||||||||
Retail
installment and lease
|
$
|
681
|
$
|
1,281
|
$
|
(600
|
)
|
|||
Wholesale
|
23
|
43
|
(20
|
)
|
||||||
Other
|
2
|
3
|
(1
|
)
|
||||||
Total
on-balance sheet
|
$
|
706
|
$
|
1,327
|
$
|
(621
|
)
|
|||
Reacquired
Receivables (retail)*
|
$
|
22
|
$
|
74
|
$
|
(52
|
)
|
|||
Securitized
Off-Balance Sheet
|
||||||||||
Retail
installment and lease
|
$
|
127
|
$
|
244
|
$
|
(117
|
)
|
|||
Wholesale
|
—
|
—
|
—
|
|||||||
Other
|
—
|
—
|
—
|
|||||||
Total
securitized off-balance sheet
|
$
|
127
|
$
|
244
|
$
|
(117
|
)
|
|||
Managed
|
||||||||||
Retail
installment and lease
|
$
|
830
|
$
|
1,599
|
$
|
(769
|
)
|
|||
Wholesale
|
23
|
43
|
(20
|
)
|
||||||
Other
|
2
|
3
|
(1
|
)
|
||||||
Total
managed
|
$
|
855
|
$
|
1,645
|
$
|
(790
|
)
|
|||
Loss-to-Receivables
Ratios
|
||||||||||
On-Balance
Sheet
|
||||||||||
Retail
installment and lease
|
0.72
|
%
|
1.25
|
%
|
(0.53
|
) pts . | ||||
Wholesale
|
0.09
|
0.20
|
(0.11
|
)
|
||||||
Total
including other
|
0.57
|
%
|
1.02
|
%
|
(0.45
|
) pts. | ||||
Managed
|
||||||||||
Retail
installment and lease
|
0.73
|
%
|
1.29
|
%
|
(0.56
|
) pts . | ||||
Wholesale
|
0.06
|
0.10
|
(0.04
|
)
|
||||||
Total
including other
|
0.54
|
%
|
0.96
|
%
|
(0.42
|
) pts. |
* |
Reacquired
receivables reflect the amount of receivables that resulted from
the
accounting consolidation of Ford Credit's FCAR Owner Trust retail
securitization program ("FCAR") in the second quarter of
2003.
|
|
2005
|
2004
|
|||||
Allowance
for Credit Losses
|
|||||||
Balance,
beginning of year
|
$
|
2.4
|
$
|
2.9
|
|||
Provision
for credit losses
|
0.2
|
0.9
|
|||||
Deductions
|
|||||||
Charge-offs
|
1.2
|
1.8
|
|||||
Recoveries
|
(0.5
|
)
|
(0.5
|
)
|
|||
Net
charge-offs
|
0.7
|
1.3
|
|||||
Other
changes, principally amounts related to finance receivables sold
and
translation adjustments
|
0.3
|
0.1
|
|||||
Net
deductions
|
1.0
|
1.4
|
|||||
Balance,
end of year
|
$
|
1.6
|
$
|
2.4
|
|||
Allowance
for credit losses as a percentage of end-of-period net
receivables
|
1.19
|
%
|
1.80
|
%
|
Restated
|
||||||||||
|
Income/(Loss)
Before
Income Taxes
|
|||||||||
|
2004
|
2003
|
2004
Over/(Under)
2003
|
|||||||
Ford
Credit
|
$
|
3,710
|
$
|
2,010
|
$
|
1,700
|
||||
Hertz*
|
493
|
228
|
265
|
|||||||
Other
Financial Services
|
84
|
63
|
21
|
|||||||
Total
Financial Services sector
|
$
|
4,287
|
$
|
2,301
|
$
|
1,986
|
* |
Includes
amortization expense related to intangibles recognized upon consolidation
of Hertz.
|
|
December
31,
|
|||||||||
|
2005
|
2004
|
2003
|
|||||||
Cash
and cash equivalents
|
$
|
13.4
|
$
|
10.1
|
$
|
6.9
|
||||
Marketable
securities
|
6.9
|
8.3
|
9.3
|
|||||||
Loaned
securities*
|
3.4
|
1.1
|
5.7
|
|||||||
Total
cash, marketable securities and loaned securities
|
23.7
|
19.5
|
21.9
|
|||||||
Short-term
VEBA assets
|
1.4
|
4.1
|
4.0
|
|||||||
Gross
cash
|
$
|
25.1
|
$
|
23.6
|
$
|
25.9
|
*
|
As
part of our investment strategy, we engage in securities lending
to
improve the returns on our cash portfolios. See Note 5 of the Notes
to the
Financial Statements for additional discussion on securities
lending.
|
Restated
|
||||||||||
|
2005
|
2004
|
2003
|
|||||||
Gross
cash at end of period
|
$
|
25.1
|
$
|
23.6
|
$
|
25.9
|
||||
Gross
cash at beginning of period
|
23.6
|
25.9
|
25.3
|
|||||||
Total
change in gross cash
|
$
|
1.5
|
$
|
(2.3
|
)
|
$
|
0.6
|
|||
Operating-related
cash flow
|
||||||||||
Automotive
income/(loss) before income taxes
|
$
|
(3.9
|
)
|
$
|
(0.2
|
)
|
$
|
(1.9
|
)
|
|
Non-cash
portion of special items
|
1.2
|
1.1
|
2.0
|
|||||||
Capital
expenditures
|
(7.1
|
)
|
(6.3
|
)
|
(7.3
|
)
|
||||
Depreciation
and special tools amortization
|
8.2
|
6.4
|
5.5
|
|||||||
Changes
in receivables, inventory and trade payables (a)
|
0.9
|
(0.4
|
)
|
(1.4
|
)
|
|||||
Other
(b)
|
(1.0
|
)
|
0.4
|
3.3
|
||||||
Total
operating-related cash flows
|
(1.7
|
)
|
1.0
|
0.2
|
||||||
Other
changes in cash
|
||||||||||
Funded
pension plans/long-term VEBA contributions
|
(2.7
|
)
|
(5.0
|
)
|
(4.8
|
)
|
||||
Tax
refunds
|
0.3
|
0.3
|
1.7
|
|||||||
Capital
transactions with Financial Services sector (c)
|
2.3
|
4.2
|
3.6
|
|||||||
Acquisitions
and divestitures (d)
|
5.3
|
0.4
|
0.5
|
|||||||
Dividends
paid to shareholders
|
(0.7
|
)
|
(0.7
|
)
|
(0.7
|
)
|
||||
Changes
in total Automotive sector debt
|
(0.5
|
)
|
(2.4
|
)
|
(0.2
|
)
|
||||
Cash
from Variable Interest Entity ("VIE") consolidations (e)
|
—
|
—
|
0.3
|
|||||||
Other
(f)
|
(0.8
|
)
|
(0.1
|
)
|
—
|
|||||
Total
change in gross cash
|
$
|
1.5
|
$
|
(2.3
|
)
|
$
|
0.6
|
(a)
|
In
2005, we took measures to improve our working capital, including
reducing
inventory (both production materials and finished vehicles) and changing
the way our European affiliates pay
suppliers.
|
(b)
|
Primarily
expense and payment timing differences for items such as marketing,
warranty, pension and OPEB.
|
(c)
|
Primarily
dividends received from Ford Credit, excluding proceeds from Financial
Services sector divestitures paid to the Automotive
sector.
|
(d)
|
In
2005, primarily proceeds from the sale of Hertz and the final payment
for
the Land Rover acquisition.
|
(e)
|
See
Note 17 of the Notes to the Financial Statements for a discussion
of
VIEs.
|
(f)
|
In
2005, primarily cash flow associated with the acquisition of ACH
from
Visteon (an outflow of about $700 million), dividends to minority
shareholders of consolidated subsidiaries (an outflow of about $200
million), and the net issuance of Ford Common stock under employee
savings
plans (an inflow of about $200
million).
|
Restated
|
||||||||||
|
2005
|
2004
|
2003
|
|||||||
Net
cash flows from operating activities
|
$
|
5.4
|
$
|
7.0
|
$
|
3.0
|
||||
Items
included in operating-related cash flow
|
||||||||||
Capital
expenditures
|
(7.1
|
)
|
(6.3
|
)
|
(7.3
|
)
|
||||
Net
transactions between Automotive and Financial Services sectors
(a)
|
(0.4
|
)
|
1.3
|
1.2
|
||||||
Net
sales/(purchases) of trading securities
|
0.6
|
(5.6
|
)
|
(1.6
|
)
|
|||||
Other
(b)
|
(2.6
|
)
|
(0.1
|
)
|
1.8
|
|||||
Items
not included in operating-related cash flow
|
||||||||||
Pension
and long-term VEBA contributions
|
2.7
|
5.0
|
4.8
|
|||||||
Tax
refunds
|
(0.3
|
)
|
(0.3
|
)
|
(1.7
|
)
|
||||
Operating-related
cash flows
|
$
|
(1.7
|
)
|
$
|
1.0
|
$
|
0.2
|
(a) |
Primarily
payables and receivables between the sectors in the normal course
of
business, as shown in our Condensed Sector Statement of Cash Flows
for the
Automotive sector.
|
(b) |
Primarily
the exclusion of cash flow from short-term VEBA
contribution/(drawdown).
|
|
2006
Forecast
|
2005
|
2004
|
|||||||
Unsecured
Term Debt
|
||||||||||
Institutional
|
$
|
0
- 2
|
$
|
8
|
$
|
7
|
||||
Retail
|
0
- 1
|
1
|
5
|
|||||||
Total
unsecured term debt
|
0
- 3
|
9
|
12
|
|||||||
Term
Public Securitization
(a)
|
8
- 12
|
12
|
6
|
|||||||
Total
term public funding
|
$
|
8
- 15
|
$
|
21
|
$
|
18
|
||||
Memo
- Not Included Above
|
||||||||||
Private
transactions (b)
|
$
|
25
- 35
|
$
|
18
|
$
|
10
|
(a)
|
Reflects
new issuance and includes funding from discontinued operations in
2004;
excludes whole-loan sales and other structured
financings.
|
(b)
|
Includes
private securitizations, other structured financings and whole-loan
sales;
excludes sales to Ford Credit's on-balance sheet asset-backed commercial
paper programs and proceeds from revolving
transactions.
|
*
|
Excluding
marketable securities related to insurance
activities.
|
Restated
|
||||||||||
|
December
31,
|
|||||||||
|
2005
|
2004
|
2003
|
|||||||
Total
debt
|
$
|
133.4
|
$
|
142.4
|
$
|
147.0
|
||||
Total
stockholder's equity
|
11.4
|
12.8
|
14.2
|
|||||||
Debt-to-equity
ratio (to 1)
|
11.7
|
11.1
|
10.4
|
Restated
|
||||||||||
|
December
31,
|
|||||||||
|
2005
|
2004
|
2003
|
|||||||
Total
debt
|
$
|
133.4
|
$
|
142.4
|
$
|
147.0
|
||||
Securitized
off-balance sheet receivables outstanding (a)
|
18.0
|
37.7
|
49.4
|
|||||||
Retained
interest in securitized off-balance sheet receivables (b)
|
(1.4
|
)
|
(9.5
|
)
|
(13.0
|
)
|
||||
Adjustments
for cash, cash equivalents and marketable securities (c)
|
(17.9
|
)
|
(12.7
|
)
|
(15.7
|
)
|
||||
Fair
value hedge accounting adjustments
|
(0.5
|
)
|
(1.3
|
)
|
(2.1
|
)
|
||||
Total
adjusted debt
|
$
|
131.6
|
$
|
156.6
|
$
|
165.6
|
||||
Total
stockholder's equity (including minority interest)
|
$
|
11.4
|
$
|
12.8
|
$
|
14.2
|
||||
Fair
value hedge accounting adjustments
|
(0.7
|
)
|
(1.3
|
)
|
(1.5
|
)
|
||||
Total
adjusted equity
|
$
|
10.7
|
$
|
11.5
|
$
|
12.7
|
||||
Managed
debt-to-equity ratio (to 1)
|
12.3
|
13.6
|
13.1
|
(a)
|
Includes
securitized funding from discontinued operations in 2003 and
2004.
|
(b)
|
Includes
retained interest in securitized receivables from discontinued operations
in 2003 and 2004.
|
(c)
|
Excluding
marketable securities related to insurance
activities
|
•
|
Dominion
Bond Rating Service Limited ("DBRS");
|
•
|
Fitch,
Inc. ("Fitch");
|
•
|
Moody's
Investors Service, Inc. ("Moody's"); and
|
•
|
Standard
& Poor's Rating Services, a division of McGraw-Hill Companies, Inc.
("S&P").
|
DBRS
|
Fitch
|
Moody's
|
S&P
|
|||||||||
Long-
Term
|
Short-Term
|
Trend
|
Long-Term
|
Short-Term
|
Outlook
|
Long-Term
|
Short-Term
|
Outlook
|
Long-Term
|
Short-Term
|
Outlook
|
|
Ford
|
BB
(low)
|
R-3
(high)
|
Negative
|
BB+
|
B
|
Negative
|
Ba3
|
NA
|
Negative
|
BB-
|
B-2
|
Negative
|
Ford
Credit
|
BB
|
R-3
(high)
|
Negative
|
BB+
|
B
|
Negative
|
Ba2
|
NP
|
Negative
|
BB-
|
B-2
|
Negative
|
Industry
Volume
(SAAR
incl. heavy trucks)
|
Planning
Assumptions
|
U.S
|
17.0
million units
|
Europe
|
17.3
million units
|
Industry
Net Pricing
|
|
U.S
|
Slightly
negative
|
Europe
|
Slightly
negative
|
Operation
Metrics
|
2006
Milestones
|
Quality
|
Improved
|
Market
share
|
Flat
to improved
|
Automotive
cost performance*
|
Favorable
|
Capital
spending
|
About
$7 billion
|
* |
At
constant volume, mix and exchange; excluding special
items.
|
·
|
Continued
decline in market share;
|
·
|
Continued
or increased price competition resulting from industry overcapacity,
currency fluctuations or other
factors;
|
·
|
A
market shift (or an increase in or acceleration of market shift)
away from
sales of trucks or sport utility vehicles, or from sales of other
more
profitable vehicles in the United States;
|
·
|
A
significant decline in industry sales, particularly in the United
States
or Europe, resulting from slowing economic growth, geo-political
events or
other factors;
|
·
|
Lower-than-anticipated
market acceptance of new or existing
products;
|
·
|
Continued
or increased high prices for or reduced availability of
fuel;
|
·
|
Currency
or commodity price fluctuations;
|
·
|
Adverse
effects from the bankruptcy or insolvency of a major
competitor;
|
·
|
Economic
distress of suppliers that has in the past and may in the future
require
us to provide financial support or take other measures to ensure
supplies
of components or materials;
|
·
|
Work
stoppages at Ford or supplier facilities or other interruptions of
supplies;
|
·
|
Single-source
supply of components or materials;
|
·
|
Labor
or other constraints on our ability to restructure our
business;
|
·
|
Worse-than-assumed
economic and demographic experience for our postretirement benefit
plans
(e.g., discount rates, investment returns, and health care cost
trends);
|
·
|
The
discovery of defects in vehicles resulting in delays in new model
launches, recall campaigns or increased warranty
costs;
|
·
|
Increased
safety, emissions, fuel economy or other (e.g., pension funding)
regulation resulting in higher costs, cash expenditures, and/or sales
restrictions;
|
·
|
Unusual
or significant litigation or governmental investigations arising
out of
alleged defects in our products or
otherwise;
|
·
|
A
change in our requirements for parts or materials where we have entered
into long-term supply arrangements that commit us to purchase minimum
or
fixed quantities of certain parts or materials, or to pay a minimum
amount
to the seller ("take-or-pay
contracts");
|
·
|
Inability
to access debt or securitization markets around the world at competitive
rates or in sufficient amounts due to additional credit rating downgrades
or otherwise;
|
·
|
Higher-than-expected
credit losses;
|
·
|
Increased
competition from banks or other financial institutions seeking to
increase
their share of financing Ford
vehicles;
|
·
|
Changes
in interest rates;
|
·
|
Collection
and servicing problems related to finance receivables and net investment
in operating leases;
|
·
|
Lower-than-anticipated
residual values or higher-than-expected return volumes for leased
vehicles;
|
·
|
New
or increased credit, consumer or data protection or other regulations
resulting in higher costs and/or additional financing restrictions;
and
|
·
|
Inability
to implement the Way Forward plan.
|
·
|
Discount
rates
|
·
|
Salary
growth
|
·
|
Retirement
rates
|
·
|
Expected
contributions
|
·
|
Inflation
|
·
|
Expected
return on plan assets
|
·
|
Mortality
rates
|
Increase/(Decrease)
in:
|
||||||||||||
Percentage
|
December
31, 2005
|
|
||||||||||
Point
|
U.S.
Plans
|
Non-U.S.
Plans
|
2005
Expense
|
|||||||||
Assumption
|
Change
|
Funded
Status
|
Funded
Status
|
Equity
|
U.S.
Plans
|
Non-U.S.
Plans
|
||||||
Discount
rate
|
+/-
1.0 pt.
|
$4,690/$(5,250)
|
$4,280/$(5,310)
|
$3,450/$(6,560)
|
$(110)/$320
|
$(330)/$430
|
||||||
Actual
return on assets
|
+/-
1.0
|
390/(390)
|
180/(180)
|
1,400/(200)
|
—
|
—
|
||||||
Expected
return on assets
|
+/-
1.0
|
—
|
—
|
—
|
(380)/380
|
(150)/150
|
·
|
Discount
rates
|
·
|
Salary
growth
|
·
|
Retirement
rates
|
·
|
Expected
contributions
|
·
|
Health
care cost trends
|
·
|
Expected
return on plan assets
|
·
|
Mortality
rates
|
•
|
Frequency.
The number of finance receivables and operating lease contracts that
it
expects will default over a period of time, measured as repossessions;
and
|
•
|
Loss
severity.
The
expected difference between the amount a customer owes Ford Credit
when it
charges off the finance contract and the amount it receives, net
of
expenses, from selling the repossessed vehicle, including any recoveries
from the customer.
|
|
|
Increase/(Decrease)
|
||||
Assumption
|
Percentage
Point Change
|
December
31, 2005 Allowance for Credit Losses
|
2005
Expense
|
|||
Repossession
rates *
|
+/-
0.1 pt.
|
$40/$(40)
|
$40/$(40)
|
|||
Loss
severity
|
+/-
1.0
|
10/(10)
|
10/(10)
|
* |
Reflects
the number of finance receivables and operating lease contracts that
we
expect will default over a period of time relative to the average
number
of contracts outstanding.
|
•
|
Auction
value
.
The market value of the vehicles when we sell them at the end of
the
lease; and
|
•
|
Return
volume.
The number of vehicles that will be returned to us at lease
end.
|
·
|
FCAR.
If
credit losses or delinquencies in Ford Credit's portfolio of retail,
wholesale or lease receivables exceed specified levels, FCAR is not
permitted to purchase additional asset-backed securities of the affected
type for so long as such levels are exceeded. FCAR is permitted to
purchase only highly-rated asset-backed securities, and if the credit
enhancement on any asset-backed security purchased by FCAR is reduced
to
zero, FCAR may not purchase any additional asset-backed securities
and
would wind down its operations.
|
·
|
Conduits. If credit losses or delinquencies on the pool of sold receivables held by a conduit exceed specified levels, or if the level of overcollateralization for such pool decreases below a specified level, Ford Credit will be unable to sell additional pools of receivables to that conduit. |
· |
Wholesale
Securitization and Motown Notes Program.
If
the payment rates on wholesale receivables are lower than specified
levels, the SPE will be unable to issue additional securities and
any
existing securities would begin to amortize.
|
Restated
|
||||||||||||||||||||||
|
|
|
Payments
Due by Period
|
|||||||||||||||||||
|
Automotive
|
Financial
Services
|
Total
|
2006
|
2007-2008
|
2009-2010
|
2011
and Thereafter
|
|||||||||||||||
On-balance
sheet
|
||||||||||||||||||||||
Long-term
debt*
|
$
|
17,627
|
$
|
103,080
|
$
|
120,707
|
$
|
27,544
|
$
|
44,773
|
$
|
20,017
|
$
|
28,373
|
||||||||
Capital
lease
|
375
|
—
|
375
|
56
|
118
|
111
|
90
|
|||||||||||||||
Off-balance
sheet
|
||||||||||||||||||||||
Purchase
obligations
|
4,013
|
271
|
4,284
|
1,185
|
1,521
|
1,086
|
492
|
|||||||||||||||
Operating
lease
|
1,758
|
516
|
2,274
|
596
|
852
|
442
|
384
|
|||||||||||||||
Total
|
$
|
23,773
|
$
|
103,867
|
$
|
127,640
|
$
|
29,381
|
$
|
47,264
|
$
|
21,656
|
$
|
29,339
|
* |
Principal
obligations only.
|
•
|
Market
risk.
The possibility that changes in interest and currency exchange rates
will
adversely affect Ford Credit's cash flow and economic
value;
|
•
|
Credit
risk.
The possibility of loss from a customer's failure to make payments
according to contract terms;
|
•
|
Residual
risk.
The
possibility that the actual proceeds Ford Credit receives at lease
termination will be lower than its projections or return rates will
be
higher than its projections; and,
|
•
|
Liquidity
risk.
The possibility that Ford Credit may be unable to meet all current
and
future obligations in a timely
manner.
|
|
Pre-tax
Cash Flow Sensitivity
given
a one percentage point
instantaneous
increase
in
interest rates
(in
millions)
|
Pre-tax
Cash Flow Sensitivity
given
a one percentage point
instantaneous
decrease
in
interest rates
(in
millions)
|
|||||
December
31, 2005
|
$
|
(40
|
)
|
$
|
40
|
||
December
31, 2004
|
(93
|
)
|
93
|
·
|
Transactions
that we designated as fair value hedges involved interest rate swaps
hedging the back-end of debt instruments or involved longer-than-normal
settlement periods.
|
·
|
We
paid or received fees when entering into a derivative contract or
upon
changing counterparties.
|
·
|
Interest
rate swaps included terms that did not exactly match the terms of
the
debt, including prepayment optionality.
|
·
|
Restated
our results for the affected periods to reflect the changes in
fair value
of certain derivative transactions as gains and losses through
earnings,
without any offsetting change in the value of the debt they were
economically hedging; and
|
·
|
De-designated
all remaining derivative transactions to which we had applied the
exception set forth in Paragraph
68.
|
·
|
Review
of all hedging contracts, utilizing revised documentation requirements
and
additional criteria consistent with the application of Paragraph
68, and
recorded accounting adjustments as appropriate;
|
· |
Issuance
of a corporate directive on October 27, 2006 to suspend use of the
application of Paragraph 68 going forward. This directive also
de-designated all those derivative transactions in valid hedge
relationships that met the requirements of Paragraph 68.
|
·
|
Consolidated
Statement of Income and Sector Statement of Income for the years
ended
December 31, 2005, 2004,
and 2003.
|
·
|
Consolidated
Balance Sheet and Sector Balance Sheet at December 31, 2005 and
2004.
|
·
|
Consolidated
Statement of Cash Flows and Sector Statement of Cash Flows for the
years
ended December 31, 2005, 2004, and
2003.
|
·
|
Consolidated
Statement of Stockholders' Equity for the years ended December 31,
2005,
2004, and 2003.
|
·
|
Notes
to the Financial Statements.
|
·
|
Report
of Independent Registered Public Accounting Firm.
|
Designation
|
Description
|
Schedule
II
|
Valuation
and Qualifying Accounts
|
Designation
|
Description
|
Method
of Filing
|
Exhibit
2
|
Stock
Purchase Agreement dated as of September 12, 2005 between
CCMG Holdings, Inc., Ford Holdings LLC and Ford Motor
Company.
|
Filed
as Exhibit 2 to our Quarterly Report on Form 10-Q for the period
ended
September 30, 2005.*
|
||
Exhibit
3-A
|
Restated
Certificate of Incorporation, dated August 2, 2000.
|
Filed
as Exhibit 3-A to our Annual Report on Form 10-K for the year ended
December 31, 2000.*
|
||
Exhibit
3-B
|
By-Laws
as amended through March 10, 2005.
|
Filed
as Exhibit 3-B to our Annual Report on Form 10-K for the year ended
December 31, 2004.*
|
||
Exhibit
10-A
|
Amended
and Restated Profit Maintenance Agreement, dated as of January 1,
2002,
between Ford and Ford Credit.
|
Filed
as Exhibit 10-A to our Annual Report on Form 10-K for the year ended
December 31, 2001.*
|
Designation
|
Description
|
Method
of Filing
|
||
Exhibit
10-B
|
Executive
Separation Allowance Plan as amended through January 1, 2005 for
separations on or after January 1, 1981.**
|
Filed
as Exhibit 10-B to our Annual Report on Form 10-K for the year ended
December 31, 2004.*
|
||
Exhibit
10-C
|
Deferred
Compensation Plan for Non- Employee Directors, as amended and restated
as
of January 1, 2005.**
|
Filed
as Exhibit 10-D to our Annual Report on Form 10-K for the year ended
December 31, 2004.*
|
||
Exhibit
10-D
|
Benefit
Equalization Plan, as amended as of January 1, 2005.**
|
Filed
as Exhibit 10-E to our Annual Report on Form 10-K for the year ended
December 31, 2004.*
|
||
Exhibit
10-D-1
|
Amendment
to Benefit Equalization Plan, adopted in October 2002 and effective
as of
November 1, 2001.**
|
Filed
as Exhibit 10 to our Quarterly Report on Form 10-Q for the quarter
ended
September 30, 2002.*
|
||
Exhibit
10-E
|
Description
of financial counseling services provided to certain
executives.**
|
Filed
as Exhibit 10-F to Ford's Annual Report on Form 10-K for the year
ended
December 31, 2002.*
|
||
Exhibit
10-F
|
Supplemental
Executive Retirement Plan, as amended through January 1,
2005.**
|
Filed
as Exhibit 10-G to our Annual Report on Form 10-K for the year ended
December 31, 2004.*
|
||
Exhibit
10-G
|
Restricted
Stock Plan for Non-Employee Directors adopted by the Board of Directors
on
November 10, 1988.**
|
Filed
as Exhibit 10-P to our Annual Report on Form 10-K for the year ended
December 31, 1988.*
|
||
Exhibit
10-G-1
|
Amendment
to Restricted Stock Plan for Non-Employee Directors, effective as
of
August 1, 1996.**
|
Filed
as Exhibit 10.1 to our Quarterly Report on Form 10-Q for the quarter
ended
September 30, 1996.*
|
||
Exhibit
10-G-2
|
Amendment
to Restricted Stock Plan for Non-Employee Directors, effective as
of
July 1, 2004.**
|
Filed
as Exhibit 10 to our Quarterly Report on Form 10-Q for the quarter
ended
September 30, 2004.*
|
||
Exhibit
10-G-3
|
Description
of Director Compensation.**
|
Filed
with this Report.
|
||
Exhibit
10-H
|
1990
Long-Term Incentive Plan, amended as of June 1, 1990.**
|
Filed
as Exhibit 10-R to our Annual Report on Form 10-K for the year ended
December 31, 1990.*
|
||
Exhibit
10-H-1
|
Amendment
to 1990 Long-Term Incentive Plan, effective as of October 1,
1990.**
|
Filed
as Exhibit 10-P-1 to our Annual Report on Form 10-K for the year
ended
December 31, 1991.*
|
||
Exhibit
10-H-2
|
Amendment
to 1990 Long-Term Incentive Plan, effective as of March 8,
1995.**
|
Filed
as Exhibit 10.2 to our Quarterly Report on Form 10-Q for the quarter
ended
March 31, 1995.*
|
||
Exhibit
10-H-3
|
Amendment
to 1990 Long-Term Incentive Plan, effective as of October 1,
1997.**
|
Filed
as Exhibit 10-M-3 to our Annual Report on Form 10-K for the year
ended
December 31, 1997.*
|
||
Exhibit
10-H-4
|
Amendment
to 1990 Long-Term Incentive Plan, effective as of January 1,
1998.**
|
Filed
as Exhibit 10-M-4 to our Annual Report on Form 10-K for the year
ended
December 31, 1997.*
|
||
Exhibit
10-I
|
Description
of Matching Gift Program and Vehicle Evaluation Program for Non-Employee
Directors.**
|
Filed
with this Report.
|
||
Exhibit
10-J
|
Non-Employee
Directors Life Insurance and Optional Retirement Plan (as amended
as of
January 1, 2005).**
|
Filed
as Exhibit 10-K to our Annual Report on Form 10-K for the year ended
December 31, 2004.*
|
Designation
|
Description
|
Method
of Filing
|
||
Exhibit
10-K
|
Description
of Non-Employee Directors Accidental Death, Dismemberment and Permanent
Total Disablement Indemnity.**
|
Filed
as Exhibit 10-S to our Annual Report on Form 10-K for the year ended
December 31, 1992.*
|
||
Exhibit
10-L
|
Agreement
dated December 10, 1992 between Ford and William C.
Ford.**
|
Filed
as Exhibit 10-T to our Annual Report on Form 10-K for the year ended
December 31, 1992.*
|
||
Exhibit
10-M
|
Select
Retirement Plan, as amended through January 1, 2005.**
|
Filed
as Exhibit 10-N to our Annual Report on Form 10-K for the year ended
December 31, 2004.*
|
||
Exhibit
10-N
|
Deferred
Compensation Plan, as amended and restated as of December 7,
2005.**
|
Filed
with this Report.
|
||
Exhibit
10-O
|
Annual
Incentive Compensation Plan, as amended and restated as of January
1,
2000.**
|
Filed
as Exhibit 10-T to our Annual Report on Form 10-K for the year ended
December 31, 1999.*
|
||
Exhibit
10-O-1
|
Annual
Incentive Compensation Plan Metrics for 2006.**
|
Filed
with this Report.
|
||
Exhibit
10-P
|
1998
Long-Term Incentive Plan, as amended and restated effective as of
January
1, 2003.**
|
Filed
as Exhibit 10-R to our Annual Report on Form 10-K for the year ended
December 31, 2002.*
|
||
Exhibit
10-P-1
|
Amendment
to Ford Motor Company 1998 Long-Term Incentive Plan (effective as
of
January 1, 2006).**
|
Filed
with this Report.
|
||
Exhibit
10-P-2
|
Form
of Stock Option Agreement (NQO) with Terms and
Conditions.**
|
Filed
with this Report.
|
||
Exhibit
10-P-3
|
Form
of Stock Option Agreement (ISO) with Terms and
Conditions.**
|
Filed
with this Report.
|
||
Exhibit
10-P-4
|
Form
of Stock Option Agreement (U.K. NQO) with Terms and
Conditions.**
|
Filed
with this Report.
|
||
Exhibit
10-P-5
|
Performance
Stock Rights Description for 2005-2007 Performance
Period.**
|
Filed
as Exhibit 10-Q-4 to our Annual Report on Form 10-K for the year
ended
December 31, 2004.*
|
||
Exhibit
10-P-6
|
Performance
Stock Rights Description for 2006-2008 Performance
Period.**
|
Filed
with this Report.
|
||
Exhibit
10-P-7
|
Form
of Final Award Notification Letter For 2003-2005 Performance
Period.**
|
Filed
with this Report.
|
||
Exhibit
10-P-8
|
Form
of Restricted Stock Equivalent Grant Letter.**
|
Filed
as Exhibit 10-Q-6 to our Annual Report on Form 10-K for the year
ended
December 31, 2004.*
|
||
Exhibit
10-P-9
|
Form
of Performance-Based Restricted Stock Equivalent Opportunity Letter
for
2005.**
|
Filed
as Exhibit 10-Q-7 to our Annual Report on Form 10-K for the year
ended
December 31, 2004.*
|
||
Exhibit
10-P-10
|
Form
of Performance-Based Restricted Stock Equivalent Opportunity Letter
for
2006.**
|
Filed
with this Report.
|
||
Exhibit
10-P-11
|
Form
of Restricted Stock Grant Letter.**
|
Filed
as Exhibit 10-Q-8 to our Annual Report on Form 10-K for the year
ended
December 31, 2004.*
|
Designation
|
Description
|
Method
of Filing
|
||
Exhibit
10-P-12
|
Form
of Final Award Notification Letter for 2005 Performance-Based Restricted
Stock Equivalents.**
|
Filed
with this Report.
|
||
Exhibit
10-Q
|
Agreement
dated January 13, 1999 between Ford and Edsel B. Ford
II.**
|
Filed
as Exhibit 10-X to our Annual Report on Form 10-K for the year ended
December 31, 1998.*
|
||
Exhibit
10-R
|
Agreement
between Ford Motor Company and Ford Motor Credit Company dated as
of
October 18, 2001.
|
Filed
as Exhibit 10 to our Current Report on Form 8-K dated October 18,
2001.*
|
||
Exhibit
10-S
|
Agreement
between Ford and Carl Reichardt, entered into in June
2002.**
|
Filed
as Exhibit 10.2 to our Quarterly Report on Form 10-Q for the quarter
ended
June 30, 2002.*
|
||
Exhibit
10-T
|
Form
of Trade Secrets/Non-Compete Statement between Ford and certain of
its
Executive Officers.**
|
Filed
as Exhibit 10-V to our Annual Report on Form 10-K for the year ended
December 31, 2003.*
|
||
Exhibit
10-U
|
Form
of Special 2006-2008 Retention Incentive Opportunity
Letter.**
|
Filed
with this Report.
|
||
Exhibit
10-V
|
Form
of Special 2006 Performance Incentive Opportunity
Letter.**
|
Filed
with this Report.
|
||
Exhibit
10-W
|
Agreement
dated April 28, 2004 between Ford Motor Company and David W.
Thursfield.**
|
Filed
as Exhibit 10.1 to our Quarterly Report on Form 10-Q for the quarter
ended
June 30, 2004.*
|
||
Exhibit
10-W-1
|
Amendment
dated June 4, 2004 to Agreement dated April 28, 2004 between Ford
Motor
Company and David W. Thursfield.**
|
Filed
as Exhibit 10.2 to Ford's Quarterly Report on Form 10-Q for the quarter
ended June 30, 2004.*
|
||
Exhibit
10-X
|
Arrangement
between Ford Motor Company and Allan Gilmour dated January 28,
2005.**
|
Filed
as Exhibit 10-Y to our Annual Report on Form 10-K for the year ended
December 31, 2004.*
|
||
Exhibit
10-Y
|
Arrangement
between Ford Motor Company and Nicholas V. Scheele dated
December
10, 2004.**
|
Filed
as Exhibit 10-Z to our Annual Report on Form 10-K for the year ended
December 31, 2004.*
|
||
Exhibit
10-Y-1
|
Agreement
between Ford Motor Company and Nicholas V. Scheele dated
December
10, 2004.**
|
Filed
as Exhibit 10-Z-1 to our Annual Report on Form 10-K for the year
ended
December 31, 2004.*
|
||
Exhibit
10-Z
|
Arrangement
between Ford Motor Company and
James J. Padilla.**
|
Filed
with this Report.
|
||
Exhibit
10-AA
|
Arrangement
between Ford Motor Company and William Clay Ford, Jr. dated May 11,
2005.**
|
Filed
with our Current Report on Form 8-K dated
May 11, 2005.
|
||
Exhibit
10-AA-1
|
Arrangement
between Ford Motor Company and William Clay Ford, Jr. dated
February 27, 2006.**
|
Filed
with this Report.
|
||
Exhibit
10-BB
|
Arrangement
between Ford Motor Company and Greg C. Smith dated February 10,
2006.**
|
Filed
with this Report.
|
Designation
|
Description
|
Method
of Filing
|
||
Exhibit
10-BB-1
|
Agreement
between Ford Motor Company and Greg C. Smith dated February 10,
2006.**
|
Filed
with this Report.
|
||
Exhibit
10-CC
|
Agreement
between Ford Motor Company and Mark Fields dated October 5,
2005.**
|
Filed
with this Report.
|
||
Exhibit
10-DD
|
Description
of Company Practices regarding Club Memberships for
Executives.**
|
Filed
with this Report.
|
||
Exhibit
12
|
Calculation
of Ratio of Earnings to Combined Fixed Charges and Preferred Stock
Dividends.
|
Filed
with this Report.
|
||
Exhibit
21
|
List
of Subsidiaries of Ford as of February 22, 2006.
|
Filed
with this Report.
|
||
Exhibit
23
|
Consent
of Independent Registered Public Accounting Firm.
|
Filed
with this Report.
|
||
Exhibit
24
|
Powers
of Attorney.
|
Filed
with this Report.
|
||
Exhibit
31.1
|
Rule
15d-14(a) Certification of CEO.
|
Filed
with this Report.
|
||
Exhibit
31.2
|
Rule
15d-14(a) Certification of CFO.
|
Filed
with this Report.
|
||
Exhibit
32.1
|
Section
1350 Certification of CEO.
|
Furnished
with this Report.
|
||
Exhibit
32.2
|
Section
1350 Certification of CFO.
|
Furnished
with this Report.
|
*
|
Incorporated
by reference as an exhibit to this Report (file number reference
1-3950,
unless otherwise indicated).
|
**
|
Management
contract or compensatory plan or arrangement.
|
By:
|
/s/
PETER J. DANIEL
|
|
Peter
J. Daniel
|
||
Senior
Vice President and Controller
|
Signature
|
Title
|
Date
|
||
WILLIAM
CLAY FORD, JR.*
|
Director,
Chairman of the Board, Executive Chairman and
|
Nov.
14, 2006
|
||
William
Clay Ford, Jr.
|
Chair
of the Office of the Chairman and Chief Executive
Committee
|
|||
|
||||
/s/ALAN
MULALLY
|
Director,
President and Chief Executive Officer
|
Nov.
14, 2006
|
||
Alan
Mulally
|
(principal executive officer) | |||
JOHN
R. H. BOND*
|
Director
|
Nov.
14, 2006
|
||
John
R. H. Bond
|
||||
STEPHEN
G. BUTLER*
|
Director
and Chair of the Audit Committee
|
Nov.
14, 2006
|
||
Stephen
G. Butler
|
||||
KIMBERLY
A. CASIANO*
|
Director
|
Nov.
14, 2006
|
||
Kimberly
A. Casiano
|
||||
EDSEL
B. FORD II*
|
Director
|
Nov.
14, 2006
|
||
Edsel
B. Ford II
|
||||
IRVINE
O. HOCKADAY, JR.*
|
Director
|
Nov.
14, 2006
|
||
Irvine
O. Hockaday, Jr.
|
||||
RICHARD
A. MANOOGIAN*
|
Director
and Acting Chair of the Compensation Committee
|
Nov.
14, 2006
|
||
Richard
A. Manoogian
|
||||
ELLEN
R. MARRAM*
|
Director
and Chair of the Nominating and
|
Nov.
14, 2006
|
||
Ellen
R. Marram
|
Governance
Committee
|
|||
HOMER
A. NEAL*
|
Director
and Chair of the Environmental and
|
Nov.
14, 2006
|
||
Homer
A. Neal
|
Public
Policy Committee
|
|||
JORMA
OLLILA*
|
Director
|
Nov.
14, 2006
|
||
Jorma
Ollila
|
JOHN
L. THORNTON*
|
Director
|
Nov.
14, 2006
|
||
John
L. Thornton
|
||||
/s/DONAT
R. LECLAIR, JR.
|
Executive
Vice President and Chief Financial Officer
|
Nov.
14, 2006
|
||
Donat
R. Leclair, Jr.
|
(principal
financial officer)
|
|||
/s/PETER
J. DANIEL
|
Senior
Vice President and Controller
|
Nov.
14, 2006
|
||
Peter
J. Daniel
|
(principal
accounting officer)
|
|||
*By:
/s/ PETER J. SHERRY, JR.
|
Nov.
14, 2006
|
|||
(Peter
J. Sherry, Jr.)
Attorney-in-Fact
|
RESTATED
- SEE NOTE 28
|
||||||||||
|
2005
|
2004
|
2003
|
|||||||
Sales
and revenues
|
||||||||||
Automotive
sales
|
$
|
153,474
|
$
|
147,119
|
$
|
139,433
|
||||
Financial
Services revenues
|
23,422
|
25,197
|
26,662
|
|||||||
Total
sales and revenues
|
176,896
|
172,316
|
166,095
|
|||||||
Costs
and expenses
|
||||||||||
Cost
of sales
|
144,924
|
135,755
|
130,278
|
|||||||
Selling,
administrative and other expenses
|
24,622
|
24,012
|
24,453
|
|||||||
Interest
expense
|
8,417
|
8,471
|
9,173
|
|||||||
Financial
Services provision for credit and insurance losses
|
483
|
1,212
|
2,248
|
|||||||
Total
costs and expenses
|
178,446
|
169,450
|
166,152
|
|||||||
Automotive
interest income and other non-operating income/(expense),
net
|
1,249
|
988
|
897
|
|||||||
Automotive
equity in net income/(loss) of affiliated companies
|
285
|
255
|
74
|
|||||||
Gain
on sale of The Hertz Corporation ("Hertz") (Note 4)
|
1,095
|
—
|
—
|
|||||||
Income/(loss)
before income taxes
|
1,079
|
4,109
|
914
|
|||||||
Provision
for/(benefit from) income taxes (Note 3)
|
(845
|
)
|
643
|
(46
|
)
|
|||||
Income/(loss)
before minority interests
|
1,924
|
3,466
|
960
|
|||||||
Minority
interests in net income/(loss) of subsidiaries
|
280
|
282
|
314
|
|||||||
Income/(loss)
from continuing operations
|
1,644
|
3,184
|
646
|
|||||||
Income/(loss)
from discontinued operations (Note 4)
|
47
|
(146
|
)
|
(143
|
)
|
|||||
Income/(loss)
before cumulative effects of changes in accounting
principles
|
1,691
|
3,038
|
503
|
|||||||
Cumulative
effects of changes in accounting principles (Notes 27 and
17)
|
(251
|
)
|
—
|
(264
|
)
|
|||||
Net
income/(loss)
|
$
|
1,440
|
$
|
3,038
|
$
|
239
|
||||
Average
number of shares of Common and Class B stock outstanding
|
1,846
|
1,830
|
1,832
|
|||||||
AMOUNTS
PER SHARE OF COMMON AND CLASS B STOCK (Note 18)
|
||||||||||
Basic
income/(loss)
|
||||||||||
Income/(loss)
from continuing operations
|
$
|
0.89
|
$
|
1.74
|
$
|
0.35
|
||||
Income/(loss)
from discontinued operations
|
0.03
|
(0.08
|
)
|
(0.08
|
)
|
|||||
Cumulative
effects of changes in accounting principles
|
(0.14
|
)
|
—
|
(0.14
|
)
|
|||||
Net
income/(loss)
|
$
|
0.78
|
$
|
1.66
|
$
|
0.13
|
||||
Diluted
income/(loss)
|
||||||||||
Income/(loss)
from continuing operations
|
$
|
0.87
|
$
|
1.59
|
$
|
0.35
|
||||
Income/(loss)
from discontinued operations
|
0.02
|
(0.07
|
)
|
(0.08
|
)
|
|||||
Cumulative
effects of changes in accounting principles
|
(0.12
|
)
|
—
|
(0.14
|
)
|
|||||
Net
income/(loss)
|
$
|
0.77
|
$
|
1.52
|
$
|
0.13
|
||||
Cash
dividends
|
$
|
0.40
|
$
|
0.40
|
$
|
0.40
|
RESTATED
- SEE NOTE 28
|
||||||||||
|
2005
|
2004
|
2003
|
|||||||
AUTOMOTIVE
|
||||||||||
Sales
|
$
|
153,474
|
$
|
147,119
|
$
|
139,433
|
||||
Costs
and expenses
|
||||||||||
Cost
of sales
|
144,924
|
135,755
|
130,278
|
|||||||
Selling,
administrative and other expenses
|
12,738
|
11,564
|
10,190
|
|||||||
Total
costs and expenses
|
157,662
|
147,319
|
140,468
|
|||||||
Operating
income/(loss)
|
(4,188
|
)
|
(200
|
)
|
(1,035
|
)
|
||||
Interest
expense
|
1,220
|
1,221
|
1,323
|
|||||||
Interest
income and other non-operating income/(expense), net
|
1,249
|
988
|
897
|
|||||||
Equity
in net income/(loss) of affiliated companies
|
285
|
255
|
74
|
|||||||
Income/(loss)
before income taxes — Automotive
|
(3,874
|
)
|
(178
|
)
|
(1,387
|
)
|
||||
FINANCIAL
SERVICES
|
||||||||||
Revenues
|
23,422
|
25,197
|
26,662
|
|||||||
Costs
and expenses
|
||||||||||
Interest
expense
|
7,197
|
7,250
|
7,850
|
|||||||
Depreciation
|
5,854
|
6,618
|
8,771
|
|||||||
Operating
and other expenses
|
6,030
|
5,830
|
5,492
|
|||||||
Provision
for credit and insurance losses
|
483
|
1,212
|
2,248
|
|||||||
Total
costs and expenses
|
19,564
|
20,910
|
24,361
|
|||||||
Gain
on sale of Hertz (Note 4)
|
1,095
|
—
|
—
|
|||||||
Income/(loss)
before income taxes — Financial
Services
|
4,953
|
4,287
|
2,301
|
|||||||
TOTAL
COMPANY
|
||||||||||
Income/(loss)
before income taxes
|
1,079
|
4,109
|
914
|
|||||||
Provision
for/(benefit from) income taxes (Note 3)
|
(845
|
)
|
643
|
(46
|
)
|
|||||
Income/(loss)
before minority interests
|
1,924
|
3,466
|
960
|
|||||||
Minority
interests in net income/(loss) of subsidiaries
|
280
|
282
|
314
|
|||||||
Income/(loss)
from continuing operations
|
1,644
|
3,184
|
646
|
|||||||
Income/(loss)
from discontinued operations (Note 4)
|
47
|
(146
|
)
|
(143
|
)
|
|||||
Income/(loss)
before cumulative effects of changes in accounting
principles
|
1,691
|
3,038
|
503
|
|||||||
Cumulative
effects of changes in accounting principles (Note 27 and
17)
|
(251
|
)
|
—
|
(264
|
)
|
|||||
Net
income/(loss)
|
$
|
1,440
|
$
|
3,038
|
$
|
239
|
||||
Average
number of shares of Common and Class B stock outstanding
|
1,846
|
1,830
|
1,832
|
|||||||
AMOUNTS
PER SHARE OF COMMON AND CLASS B STOCK (Note 18)
|
||||||||||
Basic
income/(loss)
|
||||||||||
Income/(loss)
from continuing operations
|
$
|
0.89
|
$
|
1.74
|
$
|
0.35
|
||||
Income/(loss)
from discontinued operations
|
0.03
|
(0.08
|
)
|
(0.08
|
)
|
|||||
Cumulative
effects of changes in accounting principles
|
(0.14
|
)
|
—
|
(0.14
|
)
|
|||||
Net
income/(loss)
|
$
|
0.78
|
$
|
1.66
|
$
|
0.13
|
||||
Diluted
income/(loss)
|
||||||||||
Income/(loss)
from continuing operations
|
$
|
0.87
|
$
|
1.59
|
$
|
0.35
|
||||
Income/(loss)
from discontinued operations
|
0.02
|
(0.07
|
)
|
(0.08
|
)
|
|||||
Cumulative
effects of changes in accounting principles
|
(0.12
|
)
|
—
|
(0.14
|
)
|
|||||
Net
income/(loss)
|
$
|
0.77
|
$
|
1.52
|
$
|
0.13
|
||||
Cash
dividends
|
$
|
0.40
|
$
|
0.40
|
$
|
0.40
|
RESTATED
- SEE NOTE 28
|
|||||||
December
31,
2005
|
December
31,
2004
|
||||||
ASSETS
|
|||||||
Cash
and cash equivalents
|
$
|
28,410
|
$
|
22,831
|
|||
Marketable
securities (Note 5)
|
10,672
|
8,946
|
|||||
Loaned
securities (Note 5)
|
3,461
|
1,058
|
|||||
Finance
receivables, net
|
105,975
|
109,563
|
|||||
Other
receivables, net
|
8,536
|
5,895
|
|||||
Net
investment in operating leases (Note 12)
|
27,099
|
25,564
|
|||||
Retained
interest in sold receivables (Note 13)
|
1,420
|
9,178
|
|||||
Inventories
(Note 6)
|
10,271
|
10,748
|
|||||
Equity
in net assets of affiliated companies
|
2,579
|
2,835
|
|||||
Net
property (Note 8)
|
40,677
|
43,303
|
|||||
Deferred
income taxes
|
5,880
|
6,616
|
|||||
Goodwill
and other intangible assets (Note 10)
|
5,945
|
6,394
|
|||||
Assets
of discontinued/held-for-sale operations
|
—
|
16,346
|
|||||
Other
assets
|
18,534
|
26,210
|
|||||
Total
assets
|
$
|
269,459
|
$
|
295,487
|
|||
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
|||||||
Payables
|
$
|
22,910
|
$
|
22,030
|
|||
Accrued
liabilities and deferred revenue (Note 15)
|
73,047
|
73,614
|
|||||
Debt
(Note 16)
|
153,278
|
162,425
|
|||||
Deferred
income taxes
|
5,660
|
7,627
|
|||||
Liabilities
of discontinued/held-for-sale operations
|
—
|
11,477
|
|||||
Total
liabilities
|
254,895
|
277,173
|
|||||
Minority
interests
|
1,122
|
877
|
|||||
Stockholders'
equity
|
|||||||
Capital
stock (Note 18)
|
|||||||
Common
Stock, par value $0.01 per share (1,837 million shares issued; 6,000
million shares authorized)
|
18
|
18
|
|||||
Class
B Stock, par value $0.01 per share (71 million shares issued; 530
million
shares authorized)
|
1
|
1
|
|||||
Capital
in excess of par value of stock
|
4,872
|
5,321
|
|||||
Accumulated
other comprehensive income/(loss)
|
(3,680
|
)
|
1,463
|
||||
Treasury
stock
|
(833
|
)
|
(1,728
|
)
|
|||
Earnings
retained for use in business
|
13,064
|
12,362
|
|||||
Total
stockholders' equity
|
13,442
|
17,437
|
|||||
Total
liabilities and stockholders' equity
|
$
|
269,459
|
$
|
295,487
|
RESTATED
- SEE NOTE 28
|
|||||||
|
December
31,2005
|
December
31, 2004
|
|||||
ASSETS
|
|||||||
Automotive
|
|||||||
Cash
and cash equivalents
|
$
|
13,392
|
$
|
10,142
|
|||
Marketable
securities (Note 5)
|
6,860
|
8,291
|
|||||
Loaned
securities (Note 5)
|
3,461
|
1,058
|
|||||
Total
cash, marketable and loaned securities
|
23,713
|
19,491
|
|||||
Receivables,
less allowances of $298 and $388
|
3,075
|
2,898
|
|||||
Inventories
(Note 6)
|
10,271
|
10,748
|
|||||
Deferred
income taxes
|
1,249
|
2,244
|
|||||
Other
current assets
|
8,177
|
8,916
|
|||||
Total
current assets
|
46,485
|
44,297
|
|||||
Equity
in net assets of affiliated companies
|
1,756
|
1,907
|
|||||
Net
property (Note 8)
|
40,349
|
42,894
|
|||||
Deferred
income taxes
|
10,999
|
8,357
|
|||||
Goodwill
and other intangible assets (Note 10)
|
5,928
|
6,374
|
|||||
Assets
of discontinued/held-for-sale operations
|
—
|
188
|
|||||
Other
assets
|
8,308
|
9,234
|
|||||
Total
Automotive assets
|
113,825
|
113,251
|
|||||
Financial
Services
|
|||||||
Cash
and cash equivalents
|
15,018
|
12,689
|
|||||
Investments
in securities (Note 5)
|
3,812
|
655
|
|||||
Finance
receivables, net (Note 11)
|
111,436
|
112,560
|
|||||
Net
investment in operating leases (Note 12)
|
22,951
|
22,652
|
|||||
Retained
interest in sold receivables (Note 13)
|
1,420
|
9,178
|
|||||
Goodwill
and other intangible assets (Note 10)
|
17
|
20
|
|||||
Assets
of discontinued/held-for-sale operations
|
—
|
16,158
|
|||||
Other
assets
|
7,457
|
12,523
|
|||||
Receivable
from Automotive (Note 1)
|
83
|
2,753
|
|||||
Total
Financial Services assets
|
162,194
|
189,188
|
|||||
Intersector
elimination
|
(83
|
)
|
(2,753
|
)
|
|||
Total
assets
|
$
|
275,936
|
$
|
299,686
|
|||
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
|||||||
Automotive
|
|||||||
Trade
payables
|
$
|
16,637
|
$
|
16,065
|
|||
Other
liabilities
|
4,222
|
4,269
|
|||||
Accrued
liabilities and deferred revenue (Note 15)
|
28,829
|
29,693
|
|||||
Deferred
income taxes
|
804
|
877
|
|||||
Debt
payable within one year (Note 16)
|
978
|
977
|
|||||
Current
payable to Financial Services (Note 1)
|
83
|
1,382
|
|||||
Total
current liabilities
|
51,553
|
53,263
|
|||||
Long-term
debt (Note 16)
|
16,900
|
17,250
|
|||||
Other
liabilities (Note 15)
|
38,639
|
37,105
|
|||||
Deferred
income taxes
|
586
|
312
|
|||||
Liabilities
of discontinued/held-for-sale operations
|
—
|
46
|
|||||
Payable
to Financial Services (Note 1)
|
—
|
1,371
|
|||||
Total
Automotive liabilities
|
107,678
|
109,347
|
|||||
Financial
Services
|
|||||||
Payables
|
2,051
|
1,696
|
|||||
Debt
(Note 16)
|
135,400
|
144,198
|
|||||
Deferred
income taxes
|
10,747
|
10,637
|
|||||
Other
liabilities and deferred income
|
5,579
|
6,816
|
|||||
Liabilities
of discontinued/held-for-sale operations
|
—
|
11,431
|
|||||
Total
Financial Services liabilities
|
153,777
|
174,778
|
|||||
Minority
Interests
|
1,122
|
877
|
|||||
Stockholders'
equity
|
|||||||
Capital
stock (Note 18)
|
|||||||
Common
Stock, par value $0.01 per share (1,837 million shares issued; 6,000
million shares authorized)
|
18
|
18
|
|||||
Class
B Stock, par value $0.01 per share (71 million shares issued; 530
million
shares authorized)
|
1
|
1
|
|||||
Capital
in excess of par value of stock
|
4,872
|
5,321
|
|||||
Accumulated
other comprehensive income/(loss)
|
(3,680
|
)
|
1,463
|
||||
Treasury
stock
|
(833
|
)
|
(1,728
|
)
|
|||
Earnings
retained for use in business
|
13,064
|
12,362
|
|||||
Total
stockholders' equity
|
13,442
|
17,437
|
|||||
Intersector
elimination
|
(83
|
)
|
(2,753
|
)
|
|||
Total
liabilities and stockholders' equity
|
$
|
275,936
|
$
|
299,686
|
RESTATED
- SEE NOTE 28
|
||||||||||
|
2005
|
2004
|
2003
|
|||||||
Cash
flows from operating activities of continuing operations
|
||||||||||
Net
cash flows from operating activities (Note 21)
|
$
|
20,387
|
$
|
21,683
|
$
|
15,573
|
||||
Cash
flows from investing activities of continuing operations
|
||||||||||
Capital
expenditures
|
(7,517
|
)
|
(6,738
|
)
|
(7,726
|
)
|
||||
Acquisitions
of retail and other finance receivables and operating
leases
|
(54,024
|
)
|
(63,284
|
)
|
(59,503
|
)
|
||||
Collections
of retail and other finance receivables and operating
leases
|
48,257
|
51,002
|
44,472
|
|||||||
Net
acquisitions of daily rental vehicles
|
(1,552
|
)
|
(2,192
|
)
|
(1,517
|
)
|
||||
Purchases
of securities
|
(11,883
|
)
|
(11,767
|
)
|
(22,020
|
)
|
||||
Sales
and maturities of securities
|
8,735
|
16,648
|
16,433
|
|||||||
Proceeds
from sales of retail and other finance receivables and operating
leases
|
17,288
|
6,481
|
18,401
|
|||||||
Proceeds
from sale of businesses
|
7,937
|
537
|
1,702
|
|||||||
Transfer
of cash balances upon disposition of discontinued/held-for-sale
operations
|
(1,255
|
)
|
(39
|
)
|
(10
|
)
|
||||
Cash
paid for acquisitions
|
(2,031
|
)
|
(30
|
)
|
—
|
|||||
Cash
recognized on initial consolidation of joint ventures
|
—
|
—
|
256
|
|||||||
Other
|
1,849
|
2,292
|
3,304
|
|||||||
Net
cash (used in)/provided by investing activities
|
5,804
|
(7,090
|
)
|
(6,208
|
)
|
|||||
Cash
flows from financing activities of continuing operations
|
||||||||||
Cash
dividends
|
(738
|
)
|
(733
|
)
|
(733
|
)
|
||||
Net
sales/(purchases) of Common Stock
|
325
|
(151
|
)
|
9
|
||||||
Changes
in short-term debt
|
(8,713
|
)
|
4,885
|
1,286
|
||||||
Proceeds
from issuance of other debt
|
24,559
|
22,223
|
23,086
|
|||||||
Principal
payments on other debt
|
(36,080
|
)
|
(36,000
|
)
|
(28,765
|
)
|
||||
Other
|
(153
|
)
|
(136
|
)
|
(98
|
)
|
||||
Net
cash (used in)/provided by financing activities
|
(20,800
|
)
|
(9,912
|
)
|
(5,215
|
)
|
||||
Effect
of exchange rate changes on cash
|
(496
|
)
|
505
|
811
|
||||||
Net
increase/(decrease) in cash and cash equivalents from continuing
operations
|
4,895
|
5,186
|
4,961
|
|||||||
Cash
from discontinued operations
|
||||||||||
Cash
flows from operating activities of discontinued operations
|
54
|
316
|
308
|
|||||||
Cash
flows from investing activities of discontinued operations
|
(49
|
)
|
(320
|
)
|
(280
|
)
|
||||
Cash
flows from financing activities of discontinued operations
|
—
|
—
|
(6
|
)
|
||||||
Net
increase/(decrease) in cash and cash equivalents
|
$
|
4,900
|
$
|
5,182
|
$
|
4,983
|
||||
Cash
and cash equivalents at January 1
|
$
|
22,831
|
$
|
17,675
|
$
|
13,124
|
||||
Cash
and cash equivalents of discontinued/held-for-sale operations at
January
1
|
679
|
653
|
221
|
|||||||
Net
increase/(decrease) in cash and cash equivalents
|
4,900
|
5,182
|
4,983
|
|||||||
Less:
cash and cash equivalents of discontinued/held-for-sale operations
at
December 31
|
—
|
(679
|
)
|
(653
|
)
|
|||||
Cash
and cash equivalents at December 31
|
$
|
28,410
|
$
|
22,831
|
$
|
17,675
|
RESTATED
- SEE NOTE 28
|
|||||||||||||||||||
|
2005
|
2004
|
2003
|
||||||||||||||||
|
Automotive
|
Financial
Services
|
Automotive
|
Financial
Services
|
Automotive
|
Financial
Services
|
|||||||||||||
Cash
flows from operating activities of continuing operations
|
|||||||||||||||||||
Net
cash flows from operating activities (Note 21)
|
$
|
5,433
|
$
|
6,912
|
$
|
6,963
|
$
|
7,963
|
$
|
2,955
|
$
|
11,042
|
|||||||
Cash
flows from investing activities of continuing operations
|
|||||||||||||||||||
Capital
expenditures
|
(7,123
|
)
|
(394
|
)
|
(6,280
|
)
|
(458
|
)
|
(7,347
|
)
|
(379
|
)
|
|||||||
Acquisitions
of retail and other finance receivables and operating
leases
|
—
|
(54,024
|
)
|
—
|
(63,284
|
)
|
—
|
(59,503
|
)
|
||||||||||
Collections
of retail and other finance receivables and operating
leases
|
—
|
48,245
|
—
|
51,220
|
—
|
44,114
|
|||||||||||||
Net
(increase)/decrease in wholesale receivables
|
—
|
4,751
|
—
|
2,882
|
—
|
956
|
|||||||||||||
Net
acquisitions of daily rental vehicles
|
—
|
(1,988
|
)
|
—
|
(2,492
|
)
|
—
|
(1,505
|
)
|
||||||||||
Purchases
of securities
|
(5,714
|
)
|
(6,169
|
)
|
(7,590
|
)
|
(4,177
|
)
|
(8,925
|
)
|
(13,095
|
)
|
|||||||
Sales
and maturities of securities
|
5,106
|
3,629
|
7,615
|
9,033
|
8,673
|
7,760
|
|||||||||||||
Proceeds
from sales of retail and other finance receivables and operating
leases
|
—
|
17,288
|
—
|
6,481
|
—
|
18,401
|
|||||||||||||
Proceeds
from sale of wholesale receivables
|
—
|
3,739
|
—
|
3,957
|
—
|
966
|
|||||||||||||
Proceeds
from sale of businesses
|
280
|
7,657
|
125
|
412
|
77
|
1,625
|
|||||||||||||
Transfer
of cash balances upon disposition of discontinued/held-for-sale
operations
|
—
|
(1,255
|
)
|
(26
|
)
|
(13
|
)
|
(10
|
)
|
—
|
|||||||||
Net
investing activity with Financial Services
|
8,407
|
—
|
4,361
|
—
|
3,708
|
—
|
|||||||||||||
Cash
paid for acquisitions
|
(2,031
|
)
|
—
|
(30
|
)
|
—
|
—
|
—
|
|||||||||||
Cash
recognized on initial consolidation of joint ventures
|
—
|
—
|
—
|
—
|
256
|
—
|
|||||||||||||
Other
|
387
|
1,462
|
107
|
2,185
|
684
|
2,620
|
|||||||||||||
Net
cash (used in)/provided by investing activities
|
(688
|
)
|
22,941
|
(1,718
|
)
|
5,746
|
(2,884
|
)
|
1,960
|
||||||||||
Cash
flows from financing activities of continuing operations
|
|||||||||||||||||||
Cash
dividends
|
(738
|
)
|
—
|
(733
|
)
|
—
|
(733
|
)
|
—
|
||||||||||
Net
sales/(purchases) of Common Stock
|
325
|
—
|
(151
|
)
|
—
|
9
|
—
|
||||||||||||
Changes
in short-term debt
|
(115
|
)
|
(8,598
|
)
|
(342
|
)
|
5,227
|
(237
|
)
|
1,523
|
|||||||||
Proceeds
from issuance of other debt
|
385
|
24,174
|
469
|
21,754
|
1,144
|
21,942
|
|||||||||||||
Principal
payments on other debt
|
(758
|
)
|
(35,322
|
)
|
(2,564
|
)
|
(33,436
|
)
|
(1,082
|
)
|
(27,683
|
)
|
|||||||
Net
financing activity with Automotive
|
—
|
(8,407
|
)
|
—
|
(4,361
|
)
|
—
|
(3,708
|
)
|
||||||||||
Other
|
(177
|
)
|
24
|
(39
|
)
|
(97
|
)
|
(15
|
)
|
(83
|
)
|
||||||||
Net
cash (used in)/provided by financing activities
|
(1,078
|
)
|
(28,129
|
)
|
(3,360
|
)
|
(10,913
|
)
|
(914
|
)
|
(8,009
|
)
|
|||||||
Effect
of exchange rate changes on cash
|
(23
|
)
|
(473
|
)
|
117
|
388
|
260
|
551
|
|||||||||||
Net
change in intersector receivables/payables and other
liabilities
|
(394
|
)
|
394
|
1,258
|
(1,258
|
)
|
1,186
|
(1,186
|
)
|
||||||||||
Net
increase/(decrease) in cash and cash equivalents from continuing
operations
|
3,250
|
1,645
|
3,260
|
1,926
|
603
|
4,358
|
|||||||||||||
Cash
from discontinued operations
|
|||||||||||||||||||
Cash
flows from operating activities of discontinued operations
|
(17
|
)
|
71
|
(148
|
)
|
464
|
26
|
282
|
|||||||||||
Cash
flows from investing activities of discontinued operations
|
17
|
(66
|
)
|
137
|
(457
|
)
|
(4
|
)
|
(276
|
)
|
|||||||||
Cash
flows from financing activities of discontinued operations
|
—
|
—
|
—
|
—
|
(6
|
)
|
—
|
||||||||||||
Net
increase/(decrease) in cash and cash equivalents
|
$
|
3,250
|
$
|
1,650
|
$
|
3,249
|
$
|
1,933
|
$
|
619
|
$
|
4,364
|
|||||||
Cash
and cash equivalents at January 1
|
$
|
10,142
|
$
|
12,689
|
$
|
6,856
|
$
|
10,819
|
$
|
6,243
|
$
|
6,881
|
|||||||
Cash
and cash equivalents of discontinued/held-for-sale operations at
January
1
|
—
|
679
|
37
|
616
|
31
|
190
|
|||||||||||||
Net
increase/(decrease) in cash and cash equivalents
|
3,250
|
1,650
|
3,249
|
1,933
|
619
|
4,364
|
|||||||||||||
Less:
cash and cash equivalents of discontinued/held-for-sale operations
at
December 31
|
—
|
—
|
—
|
(679
|
)
|
(37
|
)
|
(616
|
)
|
||||||||||
Cash
and cash equivalents at December 31
|
$
|
13,392
|
$
|
15,018
|
$
|
10,142
|
$
|
12,689
|
$
|
6,856
|
$
|
10,819
|
RESTATED
- SEE NOTE 28
|
|||||||||||||||||||||||||
Capital
in
|
Accumulated
Other Comprehensive
|
||||||||||||||||||||||||
Excess
|
Income/(Loss)
|
||||||||||||||||||||||||
of
Par
|
Foreign
|
Minimum
|
Derivative
|
||||||||||||||||||||||
Capital
|
Value
of
|
Retained
|
Currency
|
Pension
|
Instruments
|
||||||||||||||||||||
Stock
|
Stock
|
Earnings
|
Translation
|
Liability
|
and
Other
|
Other
|
Total
|
||||||||||||||||||
YEAR
ENDED DECEMBER 31, 2003
|
|||||||||||||||||||||||||
Balance
at beginning of year, PREVIOUSLY REPORTED
|
$
|
19
|
$
|
5,420
|
$
|
8,659
|
$
|
(1,291
|
)
|
$
|
(5,776
|
)
|
$
|
536
|
$
|
(1,977
|
)
|
$
|
5,590
|
||||||
Prior
period adjustments
|
1,892
|
109
|
13
|
29
|
2,043
|
||||||||||||||||||||
Balance
at beginning of year, RESTATED
|
19
|
5,420
|
10,551
|
(1,182
|
)
|
(5,763
|
)
|
565
|
(1,977
|
)
|
7,633
|
||||||||||||||
Comprehensive
income/(loss)
|
|||||||||||||||||||||||||
Net
income
|
239
|
239
|
|||||||||||||||||||||||
Foreign
currency translation
|
3,188
|
3,188
|
|||||||||||||||||||||||
Net
gain /(loss) on derivative instruments (net of tax of
$380)
|
(190
|
)
|
896
|
706
|
|||||||||||||||||||||
Minimum
pension liability (net of tax of $1,208)
|
2,243
|
2,243
|
|||||||||||||||||||||||
Net
holding gain/(loss) (net of tax of $1)
|
1
|
1
|
|||||||||||||||||||||||
Comprehensive
income/(loss)
|
6,377
|
||||||||||||||||||||||||
Common
Stock issued for employee benefit plans and other
|
(46
|
)
|
(46
|
)
|
|||||||||||||||||||||
ESOP
loan and treasury stock
|
228
|
228
|
|||||||||||||||||||||||
Cash
dividends
|
(733
|
)
|
(733
|
)
|
|||||||||||||||||||||
Balance
at end of year
|
$
|
19
|
$
|
5,374
|
$
|
10,057
|
$
|
1,816
|
$
|
(3,520
|
)
|
$
|
1,462
|
$
|
(1,749
|
)
|
$
|
13,459
|
|||||||
YEAR
ENDED DECEMBER 31, 2004
|
|||||||||||||||||||||||||
Balance
at beginning of year
|
$
|
19
|
$
|
5,374
|
$
|
10,057
|
$
|
1,816
|
$
|
(3,520
|
)
|
$
|
1,462
|
$
|
(1,749
|
)
|
$
|
13,459
|
|||||||
Comprehensive
income/(loss)
|
|||||||||||||||||||||||||
Net
income
|
3,038
|
3,038
|
|||||||||||||||||||||||
Foreign
currency translation
|
2,321
|
2,321
|
|||||||||||||||||||||||
Net
gain/(loss) on derivative instruments (net of tax of $76)
|
(125
|
)
|
(16
|
)
|
(141
|
)
|
|||||||||||||||||||
Minimum
pension liability (net of tax of $243)
|
(451
|
)
|
(451
|
)
|
|||||||||||||||||||||
Net
holding gain/(loss) (net of tax of $13)
|
(24
|
)
|
(24
|
)
|
|||||||||||||||||||||
Comprehensive
income/(loss)
|
4,743
|
||||||||||||||||||||||||
Common
Stock issued for employee benefit plans and other
|
(53
|
)
|
(53
|
)
|
|||||||||||||||||||||
ESOP
loan and Treasury stock
|
21
|
21
|
|||||||||||||||||||||||
Cash
dividends
|
(733
|
)
|
(733
|
)
|
|||||||||||||||||||||
Balance
at end of year
|
$
|
19
|
$
|
5,321
|
$
|
12,362
|
$
|
4,012
|
$
|
(3,971
|
)
|
$
|
1,422
|
$
|
(1,728
|
)
|
$
|
17,437
|
|||||||
YEAR
ENDED DECEMBER 31, 2005
|
|||||||||||||||||||||||||
Balance
at beginning of year
|
$
|
19
|
$
|
5,321
|
$
|
12,362
|
$
|
4,012
|
$
|
(3,971
|
)
|
$
|
1,422
|
$
|
(1,728
|
)
|
$
|
17,437
|
|||||||
Comprehensive
income/(loss)
|
|||||||||||||||||||||||||
Net
income
|
1,440
|
1,440
|
|||||||||||||||||||||||
Foreign
currency translation (Note 2)
|
(3,684
|
)
|
(3,684
|
)
|
|||||||||||||||||||||
Net
gain/(loss) on derivative instruments (net of tax of $527)
|
285
|
(1,264
|
)
|
(979
|
)
|
||||||||||||||||||||
Minimum
pension liability (net of tax of $229)
|
(425
|
)
|
(425
|
)
|
|||||||||||||||||||||
Net
holding gain/(loss) (net of tax of $30)
|
(55
|
)
|
(55
|
)
|
|||||||||||||||||||||
Comprehensive
income/(loss)
|
(3,703
|
)
|
|||||||||||||||||||||||
Common
Stock issued for employee benefit plans and other
|
(449
|
)
|
(449
|
)
|
|||||||||||||||||||||
ESOP
loan and treasury stock
|
895
|
895
|
|||||||||||||||||||||||
Cash
dividends
|
(738
|
)
|
(738
|
)
|
|||||||||||||||||||||
Balance
at end of year
|
$
|
19
|
$
|
4,872
|
$
|
13,064
|
$
|
613
|
$
|
(4,396
|
)
|
$
|
103
|
$
|
(833
|
)
|
$
|
13,442
|
|
2005
|
2004
|
|||||||||||
|
Automotive
|
Financial
Services
|
Automotive
|
Financial
Services
|
|||||||||
Finance
receivables, net (a)
|
$
|
5.5
|
$
|
3.0
|
|||||||||
Other
assets (b)
|
1.1
|
0.8
|
|||||||||||
Intersector
receivables/(payables) (c)
|
$
|
(0.1
|
)
|
0.1
|
$
|
(2.8
|
)
|
2.8
|
(a)
|
Automotive
sector receivables (generated primarily from vehicle and parts sales
to
third parties) sold to Ford Credit. These receivables are classified
as
Other
receivables, net
on
our consolidated balance sheet and
Finance
Receivables, net
on
our sector balance sheet.
|
(b)
|
Primarily
used vehicles purchased by Ford Credit pursuant to the Automotive
sector's
obligation to repurchase such vehicles from daily rental car companies,
including Hertz. These vehicles are subsequently sold at
auction.
|
(c)
|
At
December 31, 2005, primarily amounts due the Automotive sector from
Ford
Credit under a tax sharing agreement and net result of all other
transactions including receivables of Ford Credit from the Automotive
sector's consolidated dealerships. At December 31, 2004, primarily
amounts
due Ford Credit and Hertz from the Automotive sector under tax sharing
agreements and net result of all other transactions including receivables
of Ford Credit from the Automotive sector's consolidated
dealerships.
|
|
2005
|
2004
|
2003
|
|||||||
Advertising
|
$
|
5.0
|
$
|
4.7
|
$
|
4.1
|
||||
Engineering,
research and development
|
8.0
|
7.4
|
7.3
|
|
2005
|
2004
|
2003
|
|||||||
Income/(loss)
before income taxes, excluding equity in net results of affiliated
companies accounted for after-tax (in millions)
|
||||||||||
U.S.
|
$
|
40
|
$
|
2,164
|
$
|
(967
|
)
|
|||
Non-U.S.
|
743
|
1,692
|
1,797
|
|||||||
Total
|
$
|
783
|
$
|
3,856
|
$
|
830
|
||||
Provision
for income taxes (in millions)
|
||||||||||
Current
|
||||||||||
Federal
|
$
|
26
|
$
|
(119
|
)
|
$
|
(149
|
)
|
||
Non-U.S.
|
764
|
1,038
|
653
|
|||||||
State
and local
|
43
|
(148
|
)
|
32
|
||||||
Total
Current
|
833
|
771
|
536
|
|||||||
Deferred
|
||||||||||
Federal
|
(752
|
)
|
643
|
(454
|
)
|
|||||
Non-U.S
|
(822
|
)
|
(737
|
)
|
(37
|
)
|
||||
State
and local
|
(104
|
)
|
(34
|
)
|
(91
|
)
|
||||
Total
Deferred
|
(1,678
|
)
|
(128
|
)
|
(582
|
)
|
||||
Total
|
$
|
(845
|
)
|
$
|
643
|
$
|
(46
|
)
|
||
Reconciliation
of effective tax rate
|
||||||||||
U.S.
tax at statutory rate
|
35
|
%
|
35
|
%
|
35
|
%
|
||||
Non-U.S.
income taxes
|
(11
|
)
|
(2
|
)
|
—
|
|||||
State
and local income taxes
|
(4
|
)
|
—
|
(5
|
)
|
|||||
Deductible
dividends
|
(20
|
)
|
(4
|
)
|
(6
|
)
|
||||
General
business credits
|
(15
|
)
|
(4
|
)
|
(18
|
)
|
||||
Dispositions
and restructurings
|
16
|
—
|
—
|
|||||||
Medicare
prescription drug benefit
|
(13
|
)
|
(2
|
)
|
—
|
|||||
Repatriation
of foreign earnings under
The
American Jobs Creation Act of 2004
|
(33
|
)
|
—
|
—
|
||||||
Prior
year settlements and claims
|
(50
|
)
|
(7
|
)
|
—
|
|||||
Other
|
(13
|
)
|
1
|
(12
|
)
|
|||||
Effective
rate
|
(108
|
)%
|
17
|
%
|
(6
|
)%
|
|
2005
|
2004
|
|||||
Deferred
tax assets
|
|||||||
Employee
benefit plans
|
$
|
7,142
|
$
|
6,005
|
|||
Dealer
and customer allowances and claims
|
3,000
|
3,196
|
|||||
Tax
credit carryforwards
|
2,173
|
2,736
|
|||||
Other
foreign deferred tax assets
|
2,905
|
2,639
|
|||||
Allowance
for credit losses
|
1,764
|
1,957
|
|||||
All
other
|
6,227
|
6,037
|
|||||
Total
gross deferred tax assets
|
23,211
|
22,570
|
|||||
Less:
valuation allowance
|
(252
|
)
|
(172
|
)
|
|||
Total
net deferred tax assets
|
22,959
|
22,398
|
|||||
Deferred
tax liabilities
|
|||||||
Leasing
transactions
|
7,736
|
7,913
|
|||||
Depreciation
and amortization (excluding leasing transactions)
|
5,130
|
5,554
|
|||||
Finance
receivables
|
2,849
|
2,859
|
|||||
All
other
|
7,024
|
7,083
|
|||||
Total
deferred tax liabilities
|
22,739
|
23,409
|
|||||
Net
deferred tax assets/(liabilities)
|
$
|
220
|
$
|
(1,011
|
)
|
|
2005
|
2004
|
2003
|
|||||||
Sales
|
$
|
3
|
$
|
192
|
$
|
410
|
||||
Operating
income/(loss) from discontinued operations
|
$
|
(4
|
)
|
$
|
(184
|
)
|
$
|
(65
|
)
|
|
Gain/(loss)
on discontinued operations
|
13
|
(165
|
)
|
(105
|
)
|
|||||
(Provision
for)/benefit from income taxes
|
(3
|
)
|
122
|
29
|
||||||
Income/(loss)
from discontinued operations
|
$
|
6
|
$
|
(227
|
)
|
$
|
(141
|
)
|
*
|
As
part of the transaction, we forgave $1.1 billion of Visteon's liability
to
us for employee-related costs of which $600 million was recognized
in 2004
as an allowance for doubtful
accounts.
|
|
2005
|
2004
|
2003
|
|||||||
Revenues
|
$
|
118
|
$
|
493
|
$
|
550
|
||||
Operating
income/(loss) from discontinued operations
|
$
|
59
|
$
|
138
|
$
|
84
|
||||
Gain/(loss)
on discontinued operations
|
(16
|
)
|
—
|
(50
|
)
|
|||||
(Provision
for)/benefit from income taxes
|
(2
|
)
|
(57
|
)
|
(36
|
)
|
||||
Income/(loss)
from discontinued operations
|
$
|
41
|
$
|
81
|
$
|
(2
|
)
|
December
31,
2004
|
||||
Assets
|
||||
Cash
and cash equivalents
|
$
|
679
|
||
Finance
receivables
|
1,283
|
|||
Net
investment in operating leases
|
9,111
|
|||
Goodwill
and other intangibles
|
877
|
|||
Other
assets
|
2,022
|
|||
Total
assets of held-for-sale operations
|
$
|
13,972
|
||
Liabilities
|
||||
Payables
|
$
|
1,538
|
||
Debt
|
8,428
|
|||
Other
liabilities
|
1,372
|
|||
Total
liabilities of held-for-sale operations
|
$
|
11,338
|
2005
|
2004
|
||||||||||||||||||||||||
Amortized
|
Unrealized
|
Fair
|
Amortized
|
Unrealized
|
Fair
|
||||||||||||||||||||
Cost
|
Gains
|
Losses
|
Value
|
Cost
|
Gains
|
Losses
|
Value
|
||||||||||||||||||
Automotive
Sector
|
|||||||||||||||||||||||||
Trading
|
$
|
8,028
|
$
|
13
|
$
|
24
|
$
|
8,017
|
$
|
7,648
|
$
|
12
|
$
|
23
|
$
|
7,637
|
|||||||||
Available-for-sale
|
|||||||||||||||||||||||||
U.S.
government
|
1,063
|
—
|
6
|
1,057
|
933
|
1
|
9
|
925
|
|||||||||||||||||
Mortgage-backed
securities
|
527
|
1
|
4
|
524
|
212
|
2
|
1
|
213
|
|||||||||||||||||
Other
debt securities
|
729
|
1
|
7
|
723
|
582
|
1
|
9
|
574
|
|||||||||||||||||
Subtotal
|
2,319
|
2
|
17
|
2,304
|
1,727
|
4
|
19
|
1,712
|
|||||||||||||||||
Total
|
$
|
10,347
|
$
|
15
|
$
|
41
|
$
|
10,321
|
$
|
9,375
|
$
|
16
|
$
|
42
|
$
|
9,349
|
|||||||||
Financial
Services Sector
|
|||||||||||||||||||||||||
Trading
|
$
|
2
|
$
|
—
|
$
|
—
|
$
|
2
|
$
|
2
|
$
|
—
|
$
|
—
|
$
|
2
|
|||||||||
Available-for-sale
|
|||||||||||||||||||||||||
U.S.
government
|
1,702
|
1
|
—
|
1,703
|
101
|
2
|
—
|
103
|
|||||||||||||||||
Mortgage-backed
securities
|
282
|
1
|
4
|
279
|
184
|
3
|
—
|
187
|
|||||||||||||||||
Other
debt securities
|
1,722
|
1
|
3
|
1,720
|
265
|
9
|
1
|
273
|
|||||||||||||||||
Equity
|
65
|
38
|
1
|
102
|
49
|
37
|
3
|
83
|
|||||||||||||||||
Subtotal
|
3,771
|
41
|
8
|
3,804
|
599
|
51
|
4
|
646
|
|||||||||||||||||
Held-to-maturity
|
|||||||||||||||||||||||||
U.S.
government
|
6
|
—
|
—
|
6
|
7
|
—
|
—
|
7
|
|||||||||||||||||
Total
|
$
|
3,779
|
$
|
41
|
$
|
8
|
$
|
3,812
|
$
|
608
|
$
|
51
|
$
|
4
|
$
|
655
|
|
Proceeds
|
Gains/(Losses)
|
|||||||||||||||||
|
2005
|
2004
|
2003
|
2005
|
2004
|
2003
|
|||||||||||||
Automotive
Sector
|
$
|
5,106
|
$
|
7,615
|
$
|
8,673
|
$
|
(57
|
)
|
$
|
(12
|
)
|
$
|
9
|
|||||
Financial
Services Sector
|
691
|
2,032
|
4,772
|
4
|
6
|
15
|
|
Automotive
|
Financial
Services
|
|||||||||||||||||
|
Available-for-Sale
|
Available-for-Sale
|
Held-to-Maturity
|
||||||||||||||||
Contractual
Maturity
|
Amortized
Cost
|
Fair
Value
|
Amortized
Cost
|
Fair
Value
|
Amortized
Cost
|
Fair
Value
|
|||||||||||||
1
year
|
$
|
129
|
$
|
129
|
$
|
3,104
|
$
|
3,104
|
$
|
1
|
$
|
1
|
|||||||
2-5
years
|
1,506
|
1,496
|
180
|
178
|
3
|
3
|
|||||||||||||
6-10
years
|
39
|
38
|
60
|
59
|
—
|
—
|
|||||||||||||
11
years and later
|
118
|
117
|
80
|
82
|
1
|
1
|
|||||||||||||
Mortgage
backed securities
|
527
|
524
|
282
|
279
|
1
|
1
|
|||||||||||||
Equity
securities
|
—
|
—
|
65
|
102
|
—
|
—
|
|||||||||||||
Total
|
$
|
2,319
|
$
|
2,304
|
$
|
3,771
|
$
|
3,804
|
$
|
6
|
$
|
6
|
Less
Than 12 Months
|
12
Months or Greater
|
Total
|
|||||||||||||||||
Description
of Securities
|
Fair
Value
|
Gross
Unrealized Losses
|
Fair
Value
|
Gross
Unrealized Losses
|
Fair
Value
|
Gross
Unrealized Losses
|
|||||||||||||
Automotive
Sector
|
|||||||||||||||||||
U.S.
government
|
$
|
805
|
$
|
4
|
$
|
105
|
$
|
2
|
$
|
910
|
$
|
6
|
|||||||
Mortgage-backed
securities
|
288
|
2
|
89
|
2
|
377
|
4
|
|||||||||||||
Other
debt securities
|
321
|
2
|
230
|
5
|
551
|
7
|
|||||||||||||
Total
|
$
|
1,414
|
$
|
8
|
$
|
424
|
$
|
9
|
$
|
1,838
|
$
|
17
|
|||||||
Financial
Services Sector
|
|||||||||||||||||||
U.S.
government
|
$
|
29
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
29
|
$
|
—
|
|||||||
Mortgage-backed
securities
|
139
|
3
|
33
|
1
|
172
|
4
|
|||||||||||||
Other
debt securities
|
85
|
1
|
75
|
2
|
160
|
3
|
|||||||||||||
Equity
securities
|
3
|
—
|
2
|
1
|
5
|
1
|
|||||||||||||
Total
|
$
|
256
|
$
|
4
|
$
|
110
|
$
|
4
|
$
|
366
|
$
|
8
|
|
2005
|
2004
|
|||||
Raw
materials, work-in-process and supplies
|
$
|
4,056
|
$
|
3,950
|
|||
Finished
products
|
7,224
|
7,799
|
|||||
Total
inventories at FIFO
|
11,280
|
11,749
|
|||||
Less:
LIFO adjustment
|
(1,009
|
)
|
(1,001
|
)
|
|||
Total
inventories
|
$
|
10,271
|
$
|
10,748
|
2005
|
2004
|
2003
|
||||||||
Net
sales
|
$
|
26,555
|
$
|
28,015
|
$
|
20,281
|
||||
Cost
and expenses
|
25,696
|
27,226
|
19,740
|
|||||||
Income
from continuing operations
|
333
|
419
|
368
|
|||||||
Net
income
|
566
|
384
|
250
|
2005
|
2004
|
2003
|
||||||||
Net
service revenue
|
$
|
194
|
$
|
113
|
$
|
93
|
||||
Net
other expenses
|
28
|
20
|
17
|
|||||||
Income
from continuing operations
|
166
|
93
|
75
|
|||||||
Net
income
|
164
|
91
|
75
|
|
2005
|
2004
|
|||||
Land
|
$
|
697
|
$
|
727
|
|||
Buildings
and land improvements
|
12,833
|
12,598
|
|||||
Machinery,
equipment and other
|
45,680
|
46,364
|
|||||
Construction
in progress
|
2,736
|
2,089
|
|||||
Total
land, plant and equipment
|
61,946
|
61,778
|
|||||
Accumulated
depreciation
|
(32,617
|
)
|
(30,982
|
)
|
|||
Net
land, plant and equipment
|
29,329
|
30,796
|
|||||
Special
tools, net of amortization
|
11,020
|
12,098
|
|||||
Net
Automotive Sector property
|
40,349
|
42,894
|
|||||
Net
Financial Services Sector property
|
328
|
409
|
|||||
Total
|
$
|
40,677
|
$
|
43,303
|
|
2005
|
2004
|
2003
|
|||||||
Amortization
of special tools
|
$
|
3,976
|
$
|
3,162
|
$
|
2,672
|
||||
Depreciation
and other amortization
|
4,181
|
3,258
|
2,786
|
|||||||
Total
|
$
|
8,157
|
$
|
6,420
|
$
|
5,458
|
||||
Maintenance
and rearrangement
|
$
|
1,895
|
$
|
1,971
|
$
|
1,791
|
Automotive
Sector
|
Financial
Services Sector
|
|||||||||
The
Americas
|
Ford
Europe
and
PAG
|
Ford
Credit
|
||||||||
Beginning
balance, December 31, 2004
|
$
|
188
|
$
|
5,248
|
$
|
20
|
||||
Goodwill
acquired
|
55
|
—
|
—
|
|||||||
Goodwill
impairment
|
(34
|
)
|
—
|
—
|
||||||
Exchange
translation/other
|
(7
|
)
|
(342
|
)
|
(3
|
)
|
||||
Ending
balance, December 31, 2005
|
$
|
202
|
$
|
4,906
|
$
|
17
|
2005
|
2004
|
||||||||||||||||||
Automotive
Sector
|
Financial
Services
Sector
|
Automotive
Sector
|
Financial
Services
Sector
|
||||||||||||||||
Amortizable
|
Non-amortizable
|
Amortizable
|
Amortizable
|
Non-amortizable
|
Amortizable
|
||||||||||||||
Gross
carrying amount
|
$
|
558
|
$
|
431
|
$
|
4
|
$
|
604
|
$
|
484
|
$
|
4
|
|||||||
Less:
accumulated amortization
|
(169
|
)
|
—
|
(4
|
)
|
(150
|
)
|
—
|
(4
|
)
|
|||||||||
Net
intangible assets
|
$
|
389
|
$
|
431
|
$
|
—
|
$
|
454
|
$
|
484
|
$
|
—
|
|
2005
|
2004
|
|||||
Retail
|
$
|
67,928
|
$
|
84,862
|
|||
Wholesale
|
38,522
|
22,666
|
|||||
Other
finance receivables
|
6,320
|
7,096
|
|||||
Total
finance receivables
|
112,770
|
114,624
|
|||||
Allowance
for credit losses
|
(1,400
|
)
|
(2,136
|
)
|
|||
Other
|
66
|
72
|
|||||
Net
finance and other receivables
|
$
|
111,436
|
$
|
112,560
|
|||
Net
finance receivables subject to fair value*
|
$
|
105,481
|
$
|
104,893
|
|||
Fair
Value
|
$
|
105,004
|
$
|
105,132
|
*
|
December
31, 2005 and 2004, excludes $5.5 billion and $7.7 billion, respectively,
of certain receivables (primarily direct financing leases) that are
not
financial instruments.
|
|
2005
|
2004
|
|||||
Total
minimum lease rentals to be received
|
$
|
3,978
|
$
|
4,972
|
|||
Less:
Unearned income
|
(555
|
)
|
(758
|
)
|
|||
Loan
origination costs
|
41
|
50
|
|||||
Estimated
residual values
|
2,394
|
3,367
|
|||||
Less:
Allowance for credit losses
|
(59
|
)
|
(82
|
)
|
|||
Net
investment in direct financing leases
|
$
|
5,799
|
$
|
7,549
|
|
2005
|
2004
|
|||||
Financial
Services Sector
|
|||||||
Vehicles
and other equipment, at cost
|
$
|
29,489
|
$
|
30,799
|
|||
Accumulated
depreciation
|
(6,344
|
)
|
(7,842
|
)
|
|||
Allowances
for credit losses
|
(194
|
)
|
(305
|
)
|
|||
Total
Financial Services
|
22,951
|
22,652
|
|||||
Automotive
Sector
|
|||||||
Vehicles,
net of depreciation
|
4,148
|
2,912
|
|||||
Total
|
$
|
27,099
|
$
|
25,564
|
Retail
|
Wholesale
|
Total
|
||||||||
Servicing
portfolio at December 31, 2003
|
$
|
33,921
|
$
|
20,249
|
$
|
54,170
|
||||
Receivables
sales
|
6,933
|
—
|
6,933
|
|||||||
Collections
|
(20,185
|
)
|
(1,345
|
)
|
(21,530
|
)
|
||||
Servicing
portfolio at December 31, 2004
|
20,669
|
18,904
|
39,573
|
|||||||
Receivables
sales
|
18,138
|
1,561
|
19,699
|
|||||||
Collections
and re-acquired receivables
|
(17,886
|
)
|
(20,465
|
)
|
(38,351
|
)
|
||||
Servicing
portfolio at December 31, 2005
|
$
|
20,921
|
$
|
—
|
$
|
20,921
|
|
2005
|
2004
|
|||||
Residual
interest in securitization transactions
|
$
|
1,094
|
$
|
768
|
|||
Restricted
cash held for benefit of securitization SPEs
|
199
|
503
|
|||||
Subordinated
securities
|
127
|
875
|
|||||
Interest
in sold wholesale receivables and other trust assets
|
—
|
6,904
|
|||||
Senior
securities
|
—
|
128
|
|||||
Retained
interest in securitized assets
|
$
|
1,420
|
$
|
9,178
|
|
2005
|
2004
|
2003
|
|||||||
Net
gain on sales of receivables
|
$
|
87
|
$
|
160
|
$
|
373
|
||||
Income
on interest in sold wholesale receivables and retained
securities
|
327
|
588
|
679
|
|||||||
Servicing
fees
|
376
|
372
|
618
|
|||||||
Income
on residual interest and other
|
723
|
815
|
941
|
|||||||
Investment
and other income related to sales of receivables
|
$
|
1,513
|
$
|
1,935
|
$
|
2,611
|
|
2005
|
2004
|
2003
|
|||||||
Proceeds
from sales of receivables
|
||||||||||
Proceeds
from sales of retail receivables
|
$
|
15,549
|
$
|
4,795
|
$
|
15,761
|
||||
Proceeds
from interest in sold wholesale receivables
|
3,739
|
3,957
|
966
|
|||||||
Proceeds
from revolving-period securitizations
|
1,349
|
1,567
|
2,610
|
|||||||
Proceeds
from sale of retained notes - retail
|
298
|
—
|
—
|
|||||||
Total
|
$
|
20,935
|
$
|
10,319
|
$
|
19,337
|
||||
Cash
flows related to net change in retained interest
|
||||||||||
Interest
in sold retail receivables
|
$
|
708
|
$
|
1,457
|
$
|
893
|
||||
Interest
in sold wholesale receivables
|
2,684
|
(1,831
|
)
|
1,140
|
||||||
Total
|
$
|
3,392
|
$
|
(374
|
)
|
$
|
2,033
|
|||
Servicing
fees
|
||||||||||
Retail
|
$
|
260
|
$
|
260
|
$
|
409
|
||||
Wholesale
|
116
|
112
|
209
|
|||||||
Total
|
$
|
376
|
$
|
372
|
$
|
618
|
||||
Other
cash flows received on interests retained (which are reflected in
securitization income)
|
||||||||||
Retail
|
$
|
276
|
$
|
356
|
$
|
735
|
||||
Wholesale
|
507
|
802
|
810
|
|||||||
Total
|
$
|
783
|
$
|
1,158
|
$
|
1,545
|
||||
Repurchased
retail receivables
|
$
|
(43
|
)
|
$
|
(143
|
)
|
$
|
(193
|
)
|
Assumption
|
Impact
on Fair Value Based
on
Adverse Change
|
|||||||||
Percentage
|
10%
Change
|
20%
Change
|
||||||||
(annual
rate)
|
||||||||||
Cash
flow discount rate
|
11
|
%
|
$
|
(12
|
)
|
$
|
(24
|
)
|
||
Estimated
net credit loss rate
|
0.1%
- 5.0
|
%
|
(19
|
)
|
(38
|
)
|
||||
Prepayment
speed
|
0.9%
- 1.5
|
%
|
(3
|
)
|
(6
|
)
|
|
2005
|
2004
|
2003
|
|||||||
Beginning
balance
|
$
|
2,471
|
$
|
2,977
|
$
|
3,065
|
||||
Provision
for credit losses
|
167
|
923
|
1,928
|
|||||||
Total
charge-offs and recoveries
|
||||||||||
Charge-offs
|
(1,184
|
)
|
(1,843
|
)
|
(2,409
|
)
|
||||
Recoveries
|
478
|
477
|
475
|
|||||||
Net
charge-offs
|
(706
|
)
|
(1,366
|
)
|
(1,934
|
)
|
||||
Other
changes, principally amounts related to finance receivables sold
and
translation adjustments
|
(338
|
)
|
(63
|
)
|
(82
|
)
|
||||
Ending
balance
|
$
|
1,594
|
$
|
2,471
|
$
|
2,977
|
|
2005
|
2004
|
|||||
Automotive
Sector
|
|||||||
Current
|
|||||||
Dealer
and customer allowances and claims
|
$
|
13,074
|
$
|
14,152
|
|||
Deferred
revenue
|
5,697
|
4,417
|
|||||
Employee
benefit plans
|
2,059
|
1,895
|
|||||
Other
postretirement employee benefits
|
1,442
|
1,572
|
|||||
Accrued
interest
|
1,248
|
1,538
|
|||||
Pension
liability
|
398
|
69
|
|||||
Other
|
4,911
|
6,050
|
|||||
Total
Automotive current
|
28,829
|
29,693
|
|||||
Non-current
|
|||||||
Other
postretirement employee benefits
|
17,778
|
15,306
|
|||||
Dealer
and customer allowances and claims
|
7,359
|
7,728
|
|||||
Pension
liability
|
7,156
|
7,639
|
|||||
Deferred
revenue
|
2,130
|
2,188
|
|||||
Employee
benefit plans
|
1,121
|
1,117
|
|||||
Other
|
3,095
|
3,127
|
|||||
Total
Automotive non-current
|
38,639
|
37,105
|
|||||
Total
Automotive Sector
|
67,468
|
66,798
|
|||||
Financial
Services Sector
|
5,579
|
6,816
|
|||||
Total
|
$
|
73,047
|
$
|
73,614
|
|
Weighted
Average
Rate (a)
|
Amount
|
|||||||||||
|
2005
|
2004
|
2005
|
2004
|
|||||||||
Automotive
Sector
|
|||||||||||||
Debt
payable within one year
|
|||||||||||||
Short-term
|
6.0
|
%
|
8.6
|
%
|
$
|
251
|
$
|
270
|
|||||
Long-term
payable within one year
|
|||||||||||||
Senior
indebtedness
|
727
|
707
|
|||||||||||
Total
debt payable within one year
|
978
|
977
|
|||||||||||
Long-term
debt
|
|||||||||||||
Senior
indebtedness
|
|||||||||||||
Notes
and bank debt
|
7.5
|
%
|
7.4
|
%
|
11,942
|
12,303
|
|||||||
Unamortized
discount
|
(197
|
)
|
(208
|
)
|
|||||||||
Total
senior indebtedness
|
11,745
|
12,095
|
|||||||||||
Subordinated
indebtedness
|
6.5
|
%
|
6.5
|
%
|
5,155
|
5,155
|
|||||||
Total
long-term debt
|
16,900
|
17,250
|
|||||||||||
Total
debt
|
$
|
17,878
|
$
|
18,227
|
|||||||||
Fair
value (b)
|
$
|
13,179
|
$
|
18,074
|
|||||||||
Financial
Services Sector
|
|||||||||||||
Short-term
debt
|
|||||||||||||
Asset-backed
commercial paper (c)
|
$
|
21,736
|
$
|
12,612
|
|||||||||
Commercial
paper
|
1,041
|
8,916
|
|||||||||||
Other
short-term
|
9,543
|
10,590
|
|||||||||||
Total
short-term debt
|
5.0
|
%
|
2.8
|
%
|
32,320
|
32,118
|
|||||||
Long-term
debt
|
|||||||||||||
Senior
indebtedness
|
|||||||||||||
Notes
payable within one year
|
21,460
|
30,086
|
|||||||||||
Notes
payable after one year
|
63,659
|
78,219
|
|||||||||||
Unamortized
discount
|
(63
|
)
|
(70
|
)
|
|||||||||
Asset-backed
debt (d)
|
|||||||||||||
Notes
payable within one year
|
5,357
|
624
|
|||||||||||
Notes
payable after one year
|
12,667
|
3,221
|
|||||||||||
Total
long-term debt
|
5.1
|
%
|
4.4
|
%
|
103,080
|
112,080
|
|||||||
'Total
debt
|
$
|
135,400
|
$
|
144,198
|
|||||||||
Fair
value (b)
|
$
|
131,233
|
$
|
148,334
|
Long-term
debt maturities
|
2006
|
2007
|
2008
|
2009
|
2010
|
Thereafter
|
Maturity
Average (Years)
|
|||||||||||||||
Automotive
Sector
|
$
|
727
|
$
|
801
|
$
|
400
|
$
|
184
|
$
|
663
|
$
|
14,852
|
25
|
|||||||||
Financial
Services Sector
|
26,817
|
26,065
|
17,507
|
12,483
|
6,687
|
13,521
|
3
|
(a)
|
Includes
the effect of interest rate swaps
|
(b)
|
Based
on quoted market prices or current rates for similar debt with the
same
remaining maturities.
|
(c)
|
Amounts
represent asset-backed commercial paper issued by consolidated
securitization SPEs and are payable out of collections on the finance
receivables. This debt is the legal obligation of the securitization
SPEs.
|
(d)
|
Asset-backed
debt is issued by consolidated securitization SPEs and is payable
out of
collections on the finance receivables or interests in operating
leases
and the related vehicles transferred to the SPEs. This debt is the
legal
obligation of the securitization
SPEs.
|
*
|
Credit
facilities of our VIEs are excluded as we do not control their
use.
|
|
2005
|
2004
|
2003
|
|||||||
Basic
and Diluted Income/(Loss)
|
||||||||||
Basic
income/(loss) from continuing operations attributable to Common Stock
and
Class B Stock
|
$
|
1,644
|
$
|
3,184
|
$
|
646
|
||||
Effect
of dilutive convertible preferred securities
|
213
|
199
|
—
|
|||||||
Diluted
income/(loss) from continuing operations attributable to Common Stock
and
Class B Stock
|
$
|
1,857
|
$
|
3,383
|
$
|
646
|
||||
Diluted
Shares
|
||||||||||
Average
shares outstanding
|
1,846
|
1,830
|
1,832
|
|||||||
Restricted
and uncommitted-ESOP shares
|
(3
|
)
|
(4
|
)
|
(2
|
)
|
||||
Basic
shares
|
1,843
|
1,826
|
1,830
|
|||||||
Net
dilutive options and restricted and uncommitted ESOP
shares
|
10
|
18
|
13
|
|||||||
Dilutive
convertible preferred securities *
|
282
|
282
|
—
|
|||||||
Diluted
shares
|
2,135
|
2,126
|
1,843
|
*
|
In
2003, not included in calculation of diluted earnings per share due
to
their antidilutive effect are 282 million shares and the related
income
effect for convertible preferred
securities.
|
|
2005
|
2004
|
2003
|
||||||||||||||||
Stock
Option Activity
|
Shares
(millions)
|
Weighted-
Average
Exercise
Price
|
Shares
(millions)
|
Weighted-
Average
Exercise
Price
|
Shares
(millions)
|
Weighted-
Average
Exercise
Price
|
|||||||||||||
Outstanding,
beginning of year
|
245.4
|
$
|
19.13
|
234.7
|
$
|
19.34
|
212.9
|
$
|
20.88
|
||||||||||
Granted
|
27.6
|
12.46
|
26.7
|
13.46
|
31.3
|
7.93
|
|||||||||||||
Exercised*
|
(3.7
|
)
|
9.14
|
(11.7
|
)
|
10.60
|
(4.2
|
)
|
11.06
|
||||||||||
Forfeited
(including expirations)
|
(24.1
|
)
|
17.13
|
(4.3
|
)
|
18.68
|
(5.3
|
)
|
19.90
|
||||||||||
Outstanding,
end of year
|
245.2
|
18.72
|
245.4
|
19.13
|
234.7
|
19.34
|
|||||||||||||
Exercisable,
end of year
|
191.9
|
20.61
|
183.0
|
21.41
|
161.7
|
21.44
|
*
|
Exercised
at option prices ranging from $7.40 to $12.53 during 2005, $7.55
to $12.53
during 2004, and $10.99 to $13.54 during
2003.
|
|
Shares
(millions)
|
Weighted-Average
Grant-date
Fair Value
|
|||||
Nonvested
beginning of year
|
62.4
|
$
|
4.16
|
||||
Granted
|
27.6
|
4.44
|
|||||
Vested
|
(32.8
|
)
|
4.43
|
||||
Forfeited
|
(3.9
|
)
|
4.73
|
||||
Nonvested
end of year
|
53.3
|
4.09
|
2005
|
2004
|
2003
|
||||||||
Fair
value per option
|
$
|
4.44
|
$
|
4.71
|
$
|
2.07
|
||||
Assumptions:
|
||||||||||
Annualized
dividend yield
|
3.2
|
%
|
3.0
|
%
|
5.1
|
%
|
||||
Expected
volatility
|
41.9
|
%
|
42.2
|
%
|
39.3
|
%
|
||||
Risk-free
interest rate
|
4.4
|
%
|
3.4
|
%
|
3.7
|
%
|
||||
Expected
option term (in years)
|
7
|
7
|
7
|
|
Outstanding
Options
|
Exercisable
Options
|
||||||||||||||
Range
of Exercise Prices
|
Shares
(millions)
|
Weighted-
Average Life (years)
|
Weighted-
Average Exercise Price
|
Shares
(millions)
|
Weighted-
Average Exercise Price
|
|||||||||||
$
7.40 - $10.58
|
26.4
|
7.2
|
$
|
7.97
|
16.5
|
$
|
7.99
|
|||||||||
10.62 - 15.81
|
80.2
|
6.0
|
12.81
|
37.9
|
12.86
|
|||||||||||
15.91 - 23.88
|
85.7
|
4.6
|
19.99
|
84.6
|
20.04
|
|||||||||||
23.97 - 35.79
|
52.3
|
4.3
|
30.85
|
52.3
|
30.85
|
|||||||||||
41.03 - 42.52
|
0.6
|
2.3
|
41.42
|
0.6
|
41.42
|
|||||||||||
Total options
|
245.2
|
191.9
|
|
2005
|
2004
|
2003
|
|||||||
Beginning
of year: net unrealized gain/(loss) on derivative financial
instruments
|
$
|
1,221
|
$
|
1,237
|
$
|
341
|
||||
Increase/(decrease)
in fair value of derivatives
|
(664
|
)
|
896
|
1,020
|
||||||
(Gains)/losses
reclassified from OCI
|
(600
|
)
|
(912
|
)
|
(124
|
)
|
||||
End
of year: net unrealized gain/(loss) on derivative financial
instruments
|
$
|
(43
|
)
|
$
|
1,221
|
$
|
1,237
|
|
2005
|
2004
|
|||||||||||||||||
|
Notional
(in
billions)
|
Fair
Value
Assets
(in
millions)
|
Fair
Value
Liabilities
(in
millions)
|
Notional
(in
billions)
|
Fair
Value
Assets
(in
millions)
|
Fair
Value
Liabilities
(in
millions)
|
|||||||||||||
Automotive
Sector
|
|||||||||||||||||||
Foreign
currency forwards and options
|
$
|
59
|
$
|
747
|
$
|
1,168
|
$
|
68
|
$
|
2,718
|
$
|
822
|
|||||||
Commodity
forwards and options
|
3
|
703
|
38
|
3
|
383
|
89
|
|||||||||||||
Other
|
—
|
128
|
1
|
—
|
27
|
—
|
|||||||||||||
Total
derivative financial instruments
|
$
|
62
|
$
|
1,578
|
$
|
1,207
|
$
|
71
|
$
|
3,128
|
$
|
911
|
|||||||
Financial
Services Sector
|
|||||||||||||||||||
Foreign
currency swaps, forwards and options
|
$
|
24
|
$
|
1,126
|
$
|
789
|
$
|
29
|
$
|
4,201
|
$
|
1,076
|
|||||||
Interest
rate swaps
|
125
|
1,657
|
96
|
135
|
3,074
|
180
|
|||||||||||||
Impact
of netting agreements
|
—
|
(205
|
)
|
(205
|
)
|
—
|
(345
|
)
|
(345
|
)
|
|||||||||
Total
derivative financial instruments
|
$
|
149
|
$
|
2,578
|
$
|
680
|
$
|
164
|
$
|
6,930
|
$
|
911
|
|
2005
|
2004
|
2003
|
||||||||||||||||
|
Automotive
|
Financial
Services
|
Automotive
|
Financial
Services
|
Automotive
|
Financial
Services
|
|||||||||||||
Net
income/(loss)
|
$
|
(1,884
|
)
|
$
|
3,324
|
$
|
257
|
$
|
2,781
|
$
|
(1,129
|
)
|
$
|
1,368
|
|||||
(Income)/loss
of discontinued operations
|
(6
|
)
|
(41
|
)
|
227
|
(81
|
)
|
141
|
2
|
||||||||||
Cumulative
effects of changes in accounting principles
|
251
|
—
|
—
|
—
|
264
|
—
|
|||||||||||||
Depreciation
and special tools amortization
|
8,157
|
5,854
|
6,420
|
6,618
|
5,458
|
8,771
|
|||||||||||||
Amortization
of intangibles
|
49
|
6
|
26
|
10
|
24
|
11
|
|||||||||||||
Net
losses/(earnings) from equity investments in excess of dividends
received
|
(135
|
)
|
—
|
3
|
—
|
(2
|
)
|
—
|
|||||||||||
Provision
for credit/insurance losses
|
—
|
483
|
—
|
1,212
|
—
|
2,248
|
|||||||||||||
Foreign
currency adjustments
|
36
|
—
|
1
|
—
|
160
|
—
|
|||||||||||||
(Gain)/loss
on sale of business
|
—
|
(1,099
|
)
|
16
|
(66
|
)
|
—
|
(53
|
)
|
||||||||||
Stock
option expense
|
103
|
13
|
105
|
14
|
154
|
19
|
|||||||||||||
Cash
changes in operating assets and liabilities was as
follows:
|
|||||||||||||||||||
Provision
for deferred income taxes
|
(960
|
)
|
1,664
|
2,451
|
1,514
|
917
|
920
|
||||||||||||
Decrease/(increase)
in accounts receivable and other assets
|
(2,086
|
)
|
(727
|
)
|
(1,793
|
)
|
1,294
|
(2,837
|
)
|
(215
|
)
|
||||||||
Decrease/(increase)
in inventory
|
(94
|
)
|
—
|
(130
|
)
|
—
|
350
|
—
|
|||||||||||
Increase/(decrease)
in accounts payable and accrued and other liabilities
|
2,277
|
(2,343
|
)
|
(6,799
|
)
|
(923
|
)
|
(2,239
|
)
|
730
|
|||||||||
Net
sales/(purchases) of trading securities
|
(579
|
)
|
(50
|
)
|
5,600
|
92
|
1,630
|
524
|
|||||||||||
Other
|
304
|
(172
|
)
|
579
|
(4,502
|
)
|
64
|
(3,283
|
)
|
||||||||||
Cash
flows from operating activities of continuing operations
|
$
|
5,433
|
$
|
6,912
|
$
|
6,963
|
$
|
7,963
|
$
|
2,955
|
$
|
11,042
|
2005
|
2004
|
2003
|
||||||||
Sum
of sector cash flows of continuing operations from operating
activities
|
$
|
12,345
|
$
|
14,926
|
$
|
13,997
|
||||
Reclassification
of wholesale receivable cash flows from investing to operating for
consolidated presentation
|
8,478
|
7,057
|
1,564
|
|||||||
Reclassification
relating to sale of vehicles to Hertz and related auction proceeds
for
consolidated
presentation.
|
(436
|
)
|
(300
|
)
|
12
|
|||||
Consolidated
cash flows of continuing operations from operating
activities
|
$
|
20,387
|
$
|
21,683
|
$
|
15,573
|
|
2005
|
2004
|
2003
|
|||||||
Interest
|
$
|
7,825
|
$
|
7,355
|
$
|
7,543
|
||||
Income
taxes
|
382
|
211
|
(1,046
|
)
|
Segment
|
Liability
at
December
31,
2004
|
Accrued
in
2005
|
Paid
in
2005
|
Other*
|
Liability
at
December
31,
2005
|
Estimated
Total
Costs
|
|||||||||||||
Ford
Europe and PAG
|
$
|
139
|
$
|
35
|
$
|
(122
|
)
|
$
|
(40
|
)
|
$
|
12
|
$
|
774
|
* |
Includes
foreign currency translation adjustments and reductions to accrued
amounts
resulting from revisions to estimated
liabilities.
|
Segment
|
Liability
at
December
31,
2004
|
Accrued
in
2005
|
Paid
in
2005
|
Other
|
Liability
at
December
31,
2005
|
Estimated
Total
Costs
|
|||||||||||||
Ford
Credit
|
$
|
10
|
$
|
41
|
$
|
(36
|
)
|
$
|
—
|
$
|
15
|
$
|
61
|
Pension
Benefits
|
||||||||||||||||||||||||||||
U.S.
Plans
|
Non-U.S.
Plans
|
Health
Care and
Life
Insurance
|
||||||||||||||||||||||||||
2005
|
2004
|
2003
|
2005
|
2004
|
2003
|
2005
|
2004
|
2003
|
||||||||||||||||||||
Service
cost
|
$
|
734
|
$
|
636
|
$
|
600
|
$
|
630
|
$
|
554
|
$
|
492
|
$
|
710
|
$
|
548
|
$
|
515
|
||||||||||
Interest
cost
|
2,398
|
2,445
|
2,442
|
1,408
|
1,332
|
1,170
|
2,188
|
1,970
|
1,998
|
|||||||||||||||||||
Expected
return on assets
|
(3,363
|
)
|
(3,219
|
)
|
(3,202
|
)
|
(1,633
|
)
|
(1,651
|
)
|
(1,382
|
)
|
(500
|
)
|
(289
|
)
|
(37
|
)
|
||||||||||
Amortization
of:
|
||||||||||||||||||||||||||||
Prior
service costs
|
500
|
501
|
472
|
126
|
117
|
154
|
(245
|
)
|
(220
|
)
|
(179
|
)
|
||||||||||||||||
(Gains)/losses
and other
|
102
|
23
|
33
|
352
|
204
|
148
|
893
|
623
|
519
|
|||||||||||||||||||
Separation
programs
|
97
|
26
|
22
|
422
|
78
|
128
|
1
|
—
|
—
|
|||||||||||||||||||
Visteon
pre-spin liability
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
1,646
|
|||||||||||||||||||
Allocated
costs to Visteon
|
(84
|
)
|
(107
|
)
|
(88
|
)
|
—
|
—
|
—
|
(246
|
)
|
(228
|
)
|
(314
|
)
|
|||||||||||||
Net
expense/(income)
|
$
|
384
|
$
|
305
|
$
|
279
|
$
|
1,305
|
$
|
634
|
$
|
710
|
$
|
2,801
|
$
|
2,404
|
$
|
4,148
|
Pension
Benefits
|
Health
Care and
|
||||||||||||||||||
U.S.
Plans
|
Non-U.S.
Plans
|
Life
Insurance
|
|||||||||||||||||
2005
|
2004
|
2005
|
2004
|
2005
|
2004
|
||||||||||||||
Change
in Benefit Obligation
|
|||||||||||||||||||
Benefit
obligation at January 1
|
$
|
43,102
|
$
|
40,499
|
$
|
29,452
|
$
|
24,790
|
$
|
39,115
|
$
|
32,350
|
|||||||
Service
cost
|
734
|
636
|
630
|
554
|
710
|
548
|
|||||||||||||
Interest
cost
|
2,398
|
2,445
|
1,408
|
1,332
|
2,188
|
1,971
|
|||||||||||||
Amendments
|
—
|
—
|
218
|
118
|
(3,155
|
)
|
2
|
||||||||||||
Separation
programs
|
97
|
63
|
422
|
78
|
1
|
—
|
|||||||||||||
Plan
participant contributions
|
41
|
42
|
146
|
144
|
33
|
31
|
|||||||||||||
Benefits
paid
|
(2,856
|
)
|
(2,832
|
)
|
(1,355
|
)
|
(1,160
|
)
|
(1,576
|
)
|
(1,540
|
)
|
|||||||
Foreign
exchange translation
|
—
|
—
|
(2,936
|
)
|
1,944
|
110
|
86
|
||||||||||||
Divestiture
|
(400
|
)
|
—
|
(163
|
)
|
—
|
(20
|
)
|
—
|
||||||||||
Actuarial
(gain)/loss
|
482
|
2,249
|
2,878
|
1,652
|
1,868
|
5,667
|
|||||||||||||
Benefit
obligation at December 31
|
$
|
43,598
|
$
|
43,102
|
$
|
30,700
|
$
|
29,452
|
$
|
39,274
|
$
|
39,115
|
|||||||
Change
in Plan Assets
|
|||||||||||||||||||
Fair
value of plan assets at January 1
|
$
|
39,628
|
$
|
37,016
|
$
|
20,595
|
$
|
16,548
|
$
|
6,762
|
$
|
3,565
|
|||||||
Actual
return on plan assets
|
3,922
|
4,568
|
3,239
|
1,936
|
621
|
397
|
|||||||||||||
Company
contributions
|
1,432
|
872
|
1,355
|
1,775
|
200
|
2,800
|
|||||||||||||
Plan
participant contributions
|
41
|
42
|
150
|
144
|
—
|
—
|
|||||||||||||
Benefits
paid
|
(2,856
|
)
|
(2,832
|
)
|
(1,355
|
)
|
(1,160
|
)
|
(1,111
|
)
|
—
|
||||||||
Foreign
exchange translation
|
—
|
—
|
(1,924
|
)
|
1,321
|
—
|
—
|
||||||||||||
Divestiture
|
(309
|
)
|
—
|
(95
|
)
|
—
|
—
|
—
|
|||||||||||
Other
|
(1
|
)
|
(38
|
)
|
(38
|
)
|
31
|
25
|
—
|
||||||||||
Fair
value of plan assets at December 31
|
$
|
41,857
|
$
|
39,628
|
$
|
21,927
|
$
|
20,595
|
$
|
6,497
|
$
|
6,762
|
|||||||
Funded
status
|
$
|
(1,741
|
)
|
$
|
(3,474
|
)
|
$
|
(8,773
|
)
|
$
|
(8,857
|
)
|
$
|
(32,777
|
)
|
$
|
(32,353
|
)
|
|
Unamortized
prior service costs
|
2,635
|
3,139
|
912
|
823
|
(4,054
|
)
|
(1,128
|
)
|
|||||||||||
Unamortized
net (gains)/losses and other
|
4,567
|
4,777
|
8,609
|
8,794
|
17,009
|
16,054
|
|||||||||||||
Net
amount recognized
|
$
|
5,461
|
$
|
4,442
|
$
|
748
|
$
|
760
|
$
|
(19,822
|
)
|
$
|
(17,427
|
)
|
|||||
Amounts
Recognized on the Balance Sheet Consisting of
Assets/(Liabilities)
|
|||||||||||||||||||
Prepaid
assets
|
$
|
2,398
|
$
|
2,460
|
$
|
1,710
|
$
|
1,550
|
$
|
—
|
$
|
—
|
|||||||
Accrued
liabilities
|
(1,511
|
)
|
(2,679
|
)
|
(6,009
|
)
|
(5,364
|
)
|
(19,822
|
)
|
(17,427
|
)
|
|||||||
Intangible
assets
|
2,133
|
2,517
|
657
|
512
|
—
|
—
|
|||||||||||||
Accumulated
other comprehensive income
|
2,441
|
2,144
|
4,390
|
4,062
|
—
|
—
|
|||||||||||||
Net
amount recognized
|
$
|
5,461
|
$
|
4,442
|
$
|
748
|
$
|
760
|
$
|
(19,822
|
)
|
$
|
(17,427
|
)
|
|||||
Pension
Plans in Which Accumulated Benefit Obligation Exceeds Plan Assets
at
December 31
|
|||||||||||||||||||
Accumulated
benefit obligation
|
$
|
24,287
|
$
|
23,608
|
$
|
17,217
|
$
|
18,580
|
|||||||||||
Fair
value of plan assets
|
22,807
|
20,940
|
11,454
|
13,145
|
|||||||||||||||
Accumulated
Benefit Obligation at December 31
|
$
|
41,983
|
$
|
41,121
|
$
|
26,060
|
$
|
25,866
|
|||||||||||
Weighted
Average Assumptions at December 31
|
|||||||||||||||||||
Discount
rate
|
5.61
|
%
|
5.75
|
%
|
4.58
|
%
|
5.18
|
%
|
5.73
|
%
|
5.75
|
%
|
|||||||
Expected
return on assets
|
8.50
|
%
|
8.75
|
%
|
7.78
|
%
|
7.76
|
%
|
8.28
|
%
|
7.93
|
%
|
|||||||
Average
rate of increase in compensation
|
4.00
|
%
|
4.50
|
%
|
3.44
|
%
|
4.00
|
%
|
4.00
|
%
|
4.50
|
%
|
|||||||
Initial
health care cost trend rate
|
—
|
—
|
—
|
—
|
7
|
%
|
9
|
%
|
|||||||||||
Ultimate
health care cost trend rate
|
—
|
—
|
—
|
—
|
5
|
%
|
5
|
%
|
|||||||||||
Year
ultimate trend rate is reached
|
—
|
—
|
—
|
—
|
2011
|
2011
|
|||||||||||||
Assumptions
Used to Determine Net Benefit Cost for the Year Ending December
31
|
|||||||||||||||||||
Discount
rate
|
5.75
|
%
|
6.25
|
%
|
5.18
|
%
|
5.61
|
%
|
5.75
|
%
|
6.25
|
%
|
|||||||
Expected
return on assets
|
8.75
|
%
|
8.75
|
%
|
7.76
|
%
|
8.38
|
%
|
7.93
|
%
|
6.20
|
%
|
|||||||
Average
rate of increase in compensation
|
4.50
|
%
|
4.50
|
%
|
4.00
|
%
|
3.98
|
%
|
4.50
|
%
|
4.50
|
%
|
|||||||
Weighted
Average Asset Allocation at December 31*
|
|||||||||||||||||||
Equity
securities
|
72.8
|
%
|
72.7
|
%
|
65.3
|
%
|
62.4
|
%
|
66.2
|
%
|
54.3
|
%
|
|||||||
Debt
securities
|
26.7
|
%
|
26.7
|
%
|
33.7
|
%
|
36.4
|
%
|
33.8
|
%
|
45.7
|
%
|
|||||||
Real
estate
|
0.0
|
%
|
0.0
|
%
|
0.7
|
%
|
0.9
|
%
|
0.0
|
%
|
0.0
|
%
|
|||||||
Other
assets
|
0.5
|
%
|
0.6
|
%
|
0.3
|
%
|
0.3
|
%
|
0.0
|
%
|
0.0
|
%
|
|||||||
*
|
Weighted
average asset allocation based on major non-U.S. plans including
U.K.,
Canada, Germany, Sweden, Netherlands, Belgium and
Australia.
|
|
Pension
Benefits
|
||||||||||||
|
U.S.
Plans
|
Non-U.S.
Plans
|
Health
Care and Life Insurance
|
||||||||||
|
Benefit
Payments
|
Benefit
Payments
|
Benefit
Payments
|
Subsidy
Receipts
|
|||||||||
2006
|
$
|
2,870
|
$
|
1,370
|
$
|
1,750
|
$
|
(80
|
)
|
||||
2007
|
2,940
|
1,230
|
1,850
|
(90
|
)
|
||||||||
2008
|
3,010
|
1,250
|
1,950
|
(100
|
)
|
||||||||
2009
|
3,050
|
1,290
|
2,040
|
(110
|
)
|
||||||||
2010
|
3,070
|
1,330
|
2,120
|
(110
|
)
|
||||||||
2011
- 2015
|
15,410
|
7,340
|
11,630
|
(680
|
)
|
Automotive
Sector
|
||||||||||||||||
The
Americas
|
Ford
Europe
and
PAG
|
Ford
Asia
Pacific
&
Africa/
Mazda
|
Other
|
Total
|
||||||||||||
(in
millions)
|
||||||||||||||||
2005
|
||||||||||||||||
Revenues
|
||||||||||||||||
External
customer
|
$
|
85,028
|
$
|
60,201
|
$
|
8,245
|
$
|
—
|
$
|
153,474
|
||||||
Intersegment
|
3,398
|
2,154
|
131
|
—
|
5,683
|
|||||||||||
Income
|
||||||||||||||||
Income/(loss)
before income taxes
|
(2,045
|
)
|
(2,071
|
)
|
297
|
(55
|
)
|
(3,874
|
)
|
|||||||
Other
disclosures
|
||||||||||||||||
Depreciation
and amortization
|
3,843
|
4,068
|
295
|
—
|
8,206
|
|||||||||||
Automotive
interest income
|
46
|
—
|
—
|
1,141
|
1,187
|
|||||||||||
Interest
expense
|
—
|
—
|
—
|
1,220
|
1,220
|
|||||||||||
Cash
out flow for capital expenditures
|
3,867
|
2,730
|
221
|
305
|
7,123
|
|||||||||||
Unconsolidated
affiliates
|
||||||||||||||||
Equity
in net income/(loss)
|
92
|
—
|
193
|
—
|
285
|
|||||||||||
Total
assets at year end
|
113,825
|
|||||||||||||||
2004
|
||||||||||||||||
Revenues
|
||||||||||||||||
External
customer
|
$
|
86,017
|
$
|
54,146
|
$
|
6,956
|
$
|
—
|
$
|
147,119
|
||||||
Intersegment
|
3,588
|
2,630
|
113
|
—
|
6,331
|
|||||||||||
Income
|
||||||||||||||||
Income/(loss)
before income taxes
|
669
|
(653
|
)
|
82
|
(276
|
)
|
(178
|
)
|
||||||||
Other
disclosures
|
||||||||||||||||
Depreciation
and amortization
|
3,591
|
2,634
|
221
|
—
|
6,446
|
|||||||||||
Automotive
interest income
|
132
|
—
|
—
|
981
|
1,113
|
|||||||||||
Interest
expense
|
—
|
—
|
—
|
1,221
|
1,221
|
|||||||||||
Cash
out flow for capital expenditures
|
3,396
|
2,803
|
293
|
(212
|
)
|
6,280
|
||||||||||
Unconsolidated
affiliates
|
||||||||||||||||
Equity
in net income/(loss)
|
75
|
6
|
174
|
—
|
255
|
|||||||||||
Total
assets at year end
|
113,251
|
|||||||||||||||
2003
|
||||||||||||||||
Revenues
|
||||||||||||||||
External
customer
|
$
|
85,536
|
$
|
48,058
|
$
|
5,839
|
$
|
—
|
$
|
139,433
|
||||||
Intersegment
|
3,628
|
1,568
|
120
|
—
|
5,316
|
|||||||||||
Income
|
||||||||||||||||
Income/(loss)
before income taxes
|
317
|
(1,178
|
)
|
46
|
(572
|
)
|
(1,387
|
)
|
||||||||
Other
disclosures
|
||||||||||||||||
Depreciation
and amortization
|
3,348
|
1,920
|
214
|
—
|
5,482
|
|||||||||||
Automotive
interest income
|
119
|
—
|
—
|
751
|
870
|
|||||||||||
Interest
expense
|
—
|
—
|
—
|
1,323
|
1,323
|
|||||||||||
Cash
out flow for capital expenditures
|
4,191
|
2,980
|
176
|
—
|
7,347
|
|||||||||||
Unconsolidated
affiliates
|
||||||||||||||||
Equity
in net income/(loss)
|
(73
|
)
|
17
|
130
|
—
|
74
|
||||||||||
Total
assets at year end
|
111,208
|
Financial
Services Sector (a)
|
Total
Company
|
|||||||||||||||||||||
Ford
Credit
|
Hertz
|
Other
|
Elims
|
Total
|
Elims
(b)
|
Total
|
||||||||||||||||
(in
millions)
|
||||||||||||||||||||||
2005
|
||||||||||||||||||||||
Revenues
|
||||||||||||||||||||||
External
customer
|
$
|
15,883
|
$
|
7,403
|
$
|
136
|
$
|
—
|
$
|
23,422
|
$
|
—
|
$
|
176,896
|
||||||||
Intersegment
|
597
|
20
|
55
|
(47
|
)
|
625
|
(6,308
|
)
|
—
|
|||||||||||||
Income
|
||||||||||||||||||||||
Income/(loss)
before income taxes
|
2,923
|
1,980
|
50
|
—
|
4,953
|
—
|
1,079
|
|||||||||||||||
Other
disclosures
|
||||||||||||||||||||||
Depreciation
and amortization
|
4,507
|
1,316
|
37
|
—
|
5,860
|
—
|
14,066
|
|||||||||||||||
Automotive
interest income
|
1,187
|
|||||||||||||||||||||
Interest
expense
|
6,616
|
511
|
70
|
—
|
7,197
|
—
|
8,417
|
|||||||||||||||
Cash
out flow for capital expenditures
|
48
|
335
|
11
|
—
|
394
|
—
|
7,517
|
|||||||||||||||
Unconsolidated
affiliates
|
||||||||||||||||||||||
Equity
in net income/(loss)
|
11
|
—
|
—
|
—
|
11
|
—
|
296
|
|||||||||||||||
Total
assets at year end
|
162,262
|
—
|
(68
|
)
|
—
|
162,194
|
(83
|
)
|
275,936
|
|||||||||||||
2004
|
||||||||||||||||||||||
Revenues
|
||||||||||||||||||||||
External
customer
|
$
|
18,083
|
$
|
6,681
|
$
|
433
|
$
|
—
|
$
|
25,197
|
$
|
—
|
$
|
172,316
|
||||||||
Intersegment
|
478
|
19
|
13
|
(13
|
)
|
497
|
(6,828
|
)
|
—
|
|||||||||||||
Income
|
||||||||||||||||||||||
Income/(loss)
before income taxes
|
3,710
|
493
|
84
|
—
|
4,287
|
—
|
4,109
|
|||||||||||||||
Other
disclosures
|
||||||||||||||||||||||
Depreciation
and amortization
|
4,981
|
1,612
|
35
|
—
|
6,628
|
—
|
13,074
|
|||||||||||||||
Automotive
interest income
|
1,113
|
|||||||||||||||||||||
Interest
expense
|
6,733
|
408
|
109
|
—
|
7,250
|
—
|
8,471
|
|||||||||||||||
Cash
out flow for capital expenditures
|
62
|
325
|
71
|
—
|
458
|
—
|
6,738
|
|||||||||||||||
Unconsolidated
affiliates
|
||||||||||||||||||||||
Equity
in net income/(loss)
|
(2
|
)
|
—
|
—
|
—
|
(2
|
)
|
—
|
253
|
|||||||||||||
Total
assets at year end
|
172,903
|
14,417
|
1,868
|
—
|
189,188
|
(2,753
|
)
|
299,686
|
||||||||||||||
2003
|
||||||||||||||||||||||
Revenues
|
||||||||||||||||||||||
External
customer
|
$
|
20,358
|
$
|
5,926
|
$
|
378
|
$
|
—
|
$
|
26,662
|
$
|
—
|
$
|
166,095
|
||||||||
Intersegment
|
316
|
26
|
48
|
(51
|
)
|
339
|
(5,655
|
)
|
—
|
|||||||||||||
Income
|
||||||||||||||||||||||
Income/(loss)
before income taxes
|
2,010
|
228
|
63
|
—
|
2,301
|
—
|
914
|
|||||||||||||||
Other
disclosures
|
||||||||||||||||||||||
Depreciation
and amortization
|
7,076
|
1,658
|
48
|
—
|
8,782
|
—
|
14,264
|
|||||||||||||||
Automotive
interest income
|
870
|
|||||||||||||||||||||
Interest
expense
|
7,361
|
373
|
116
|
—
|
7,850
|
—
|
9,173
|
|||||||||||||||
Cash
out flow for capital expenditures
|
30
|
254
|
95
|
—
|
379
|
—
|
7,726
|
|||||||||||||||
Unconsolidated
affiliates
|
||||||||||||||||||||||
Equity
in net income/(loss)
|
12
|
—
|
(3
|
)
|
—
|
9
|
—
|
83
|
||||||||||||||
Total
assets at year end
|
179,476
|
12,920
|
3,113
|
—
|
195,509
|
(3,356
|
)
|
303,361
|
(a)
|
Financial
Services sector's interest income is recorded as
Revenues.
|
(b)
|
Includes
intersector transactions occurring in the ordinary course of
business.
|
|
2005
|
2004
|
2003
|
||||||||||||||||
|
Net
Sales
and
Revenues
|
Long
Lived
Assets
|
Net
Sales
and
Revenues
|
Long
Lived
Assets
|
Net
Sales
and
Revenues
|
Long
Live
d
Assets
|
|||||||||||||
North
America
|
|||||||||||||||||||
United
States
|
$
|
96,704
|
$
|
37,800
|
$
|
100,862
|
$
|
35,315
|
$
|
104,131
|
$
|
37,981
|
|||||||
Canada
|
7,939
|
8,062
|
7,085
|
6,900
|
6,811
|
5,711
|
|||||||||||||
Mexico
|
3,374
|
1,073
|
2,934
|
807
|
2,714
|
719
|
|||||||||||||
Total
North America
|
108,017
|
46,935
|
110,881
|
43,022
|
113,656
|
44,411
|
|||||||||||||
Europe
|
|||||||||||||||||||
Germany
|
7,642
|
4,518
|
7,396
|
6,187
|
6,251
|
6,312
|
|||||||||||||
Sweden
|
4,412
|
3,399
|
4,059
|
3,715
|
3,360
|
3,326
|
|||||||||||||
United
Kingdom
|
15,264
|
6,537
|
14,193
|
9,104
|
13,419
|
7,861
|
|||||||||||||
Other
|
23,201
|
3,172
|
20,456
|
3,715
|
17,410
|
3,798
|
|||||||||||||
Total
Europe
|
50,519
|
17,626
|
46,104
|
22,721
|
40,440
|
21,297
|
|||||||||||||
All
Other
|
18,360
|
3,215
|
15,331
|
3,124
|
11,999
|
2,816
|
|||||||||||||
Total
|
$
|
176,896
|
$
|
67,776
|
$
|
172,316
|
$
|
68,867
|
$
|
166,095
|
$
|
68,524
|
Previously
Reported
|
2005
|
2004
|
|||||||||||||||||||||||
First
Quarter
|
Second
Quarter
|
Third
Quarter
|
Fourth
Quarter
|
First
Quarter
|
Second
Quarter
|
Third
Quarter
|
Fourth
Quarter
|
||||||||||||||||||
(In
millions, except per share amounts)
|
|||||||||||||||||||||||||
Automotive
Sector
|
|||||||||||||||||||||||||
Sales
|
$
|
39,332
|
$
|
38,685
|
$
|
34,675
|
$
|
40,811
|
$
|
38,800
|
$
|
36,661
|
$
|
32,797
|
$
|
38,870
|
|||||||||
Operating
income/(loss)
|
665
|
(1,104
|
)
|
(1,668
|
)
|
(2,102
|
)
|
2,004
|
205
|
(716
|
)
|
(1,670
|
)
|
||||||||||||
Financial
Services Sector
|
|||||||||||||||||||||||||
Revenues
|
5,804
|
5,863
|
6,181
|
5,738
|
5,923
|
6,212
|
6,324
|
6,059
|
|||||||||||||||||
Income/(loss)
before income taxes
|
1,076
|
1,297
|
1,222
|
2,296
|
1,043
|
1,528
|
1,391
|
1,046
|
|||||||||||||||||
Total
Company
|
|||||||||||||||||||||||||
Income/(loss)
before cumulative effects of changes in accounting
principles
|
1,212
|
946
|
(284
|
)
|
401
|
1,952
|
1,165
|
266
|
104
|
||||||||||||||||
Net
income/(loss)
|
1,212
|
946
|
(284
|
)
|
150
|
1,952
|
1,165
|
266
|
104
|
||||||||||||||||
Common
and Class B per share from income/(loss) before cumulative effects
of
changes in accounting principles
|
|||||||||||||||||||||||||
Basic
|
$
|
0.66
|
$
|
0.51
|
$
|
(0.15
|
)
|
$
|
0.21
|
$
|
1.07
|
$
|
0.64
|
$
|
0.15
|
$
|
0.06
|
||||||||
Diluted
|
0.60
|
0.47
|
(0.15
|
)
|
0.21
|
0.94
|
0.57
|
0.15
|
0.06
|
Restated-see Note 28 |
2005
|
2004
|
|||||||||||||||||||||||
First
Quarter
|
Second
Quarter
|
Third
Quarter
|
Fourth
Quarter
|
First
Quarter
|
Second
Quarter
|
Third
Quarter
|
Fourth
Quarter
|
||||||||||||||||||
(In
millions, except per share amounts)
|
|||||||||||||||||||||||||
Automotive
Sector
|
|||||||||||||||||||||||||
Sales
|
$
|
39,414
|
$
|
38,708
|
$
|
34,656
|
$
|
40,696
|
$
|
38,820
|
$
|
36,641
|
$
|
32,797
|
$
|
38,861
|
|||||||||
Operating
income/(loss)
|
708
|
(1,067
|
)
|
(1,626
|
)
|
(2,203
|
)
|
2,224
|
149
|
(823
|
)
|
(1,750
|
)
|
||||||||||||
Financial
Services Sector
|
|||||||||||||||||||||||||
Revenues
|
5,481
|
6,458
|
5,854
|
5,629
|
6,819
|
5,157
|
7,062
|
6,159
|
|||||||||||||||||
Income/(loss)
before income taxes
|
506
|
1,692
|
714
|
2,041
|
1,547
|
89
|
1,816
|
835
|
|||||||||||||||||
Total
Company
|
|||||||||||||||||||||||||
Income/(loss)
before cumulative effects of changes in accounting
principles
|
875
|
1,215
|
(576
|
)
|
177
|
2,415
|
234
|
465
|
(76
|
)
|
|||||||||||||||
Net
income/(loss)
|
875
|
1,215
|
(576
|
)
|
(74
|
)
|
2,415
|
234
|
465
|
(76
|
)
|
||||||||||||||
Common
and Class B per share from income/(loss) before cumulative effects
of
changes in accounting principles
|
|||||||||||||||||||||||||
Basic
|
$
|
0.48
|
$
|
0.66
|
$
|
(0.31
|
)
|
$
|
0.09
|
|
$
|
1.32
|
$
|
0.13
|
$
|
0.25
|
$
|
(0.04
|
)
|
||||||
Diluted
|
0.44
|
0.60
|
(0.31
|
)
|
0.09
|
|
1.16
|
0.13
|
0.24
|
(0.04
|
)
|
|
2006
|
2007
|
2008
|
2009
|
2010
|
Thereafter
|
Total
|
|||||||||||||||
Automotive
Sector
|
$
|
483
|
$
|
411
|
$
|
257
|
$
|
202
|
$
|
127
|
$
|
278
|
$
|
1,758
|
||||||||
Financial
Services Sector
|
113
|
98
|
86
|
63
|
50
|
106
|
516
|
|
2005
|
2004
|
|||||
Beginning
balance
|
$
|
5,814
|
$
|
5,466
|
|||
Payments
made during the year
|
(3,986
|
)
|
(3,694
|
)
|
|||
Changes
in accrual related to warranties issued during the year
|
3,949
|
3,611
|
|||||
Changes
in accrual related to pre-existing warranties
|
615
|
201
|
|||||
Foreign
currency translation and other
|
(149
|
)
|
230
|
||||
Ending
balance
|
$
|
6,243
|
$
|
5,814
|
·
|
Transactions
that we designated as fair value hedges involved interest rate swaps
hedging the back-end of debt instruments or involved longer-than-normal
settlement periods.
|
·
|
We
paid or received fees when entering into a derivative contract or
upon
changing counterparties.
|
·
|
Interest
rate swaps included terms that did not exactly match the terms of
the
debt, including prepayment optionality.
|
Net
Income/(Loss)
|
Retained
Earnings
|
||||||||||||
2005
|
2004
|
2003
|
At
December 31,
2002
|
||||||||||
Previously
reported
|
$
|
2,024
|
$
|
3,487
|
$
|
495
|
$
|
8,659
|
|||||
Pre-tax
adjustments:
|
|||||||||||||
Fair
value interest rate swaps
|
(873
|
)
|
(769
|
)
|
(990
|
)
|
3,665
|
||||||
Out-of-period
adjustments
|
(44
|
)
|
25
|
565
|
(608
|
)
|
|||||||
Total
pre-tax adjustments
|
(917
|
)
|
(744
|
)
|
(425
|
)
|
3,057
|
||||||
Related
tax effects - provision for/(benefit from)
|
(333
|
)
|
(295
|
)
|
(169
|
)
|
1,165
|
||||||
Net
after-tax adjustments
|
(584
|
)
|
(449
|
)
|
(256
|
)
|
1,892
|
||||||
Restated
|
$
|
1,440
|
$
|
3,038
|
$
|
239
|
$
|
10,551
|
·
|
Automotive
revenue recognition: As disclosed in Note 2, vehicle sales are generally
recorded when shipped. In the late 1990s, we determined that vehicles
sold
in the UK did not meet the criteria for revenue recognition at the
time of
shipment. We had previously judged the impact of this practice to
be
immaterial to any individual period. Beginning in 2001 and continuing
through 2003, as we launched new vehicles, we amended our UK dealer
contracts to transfer all risks of ownership to our dealers at the
time of
vehicle shipment. As part of the restatement, we have changed the
periods
in which revenue was recognized for these UK vehicles from shipment
to the
subsequent period when risk of ownership was transferred. As part
of our
restatement, we recognized additional pre-tax income/(loss) of $246
million in 2003.
|
·
|
Financial
Services revenue recognition: We recorded out-of-period adjustments
to
revenue primarily associated with our operating lease contracts in
order
to reflect earnings on a straight-line basis rather than an
effective-interest rate method and corrected the accounting related
to the amortization of certain loan origination costs involving
securitized assets. As part of our restatement, we recognized additional
pre-tax income/(loss) of $(115) million, $63 million, and $59 million
in 2005, 2004, and 2003,
respectively.
|
·
|
Employee-benefit
related expenses: We recorded an out-of-period adjustment primarily
related to special termination packages offered outside of our normal
separation programs that were not recognized as employees separated,
but
when paid. As part of our restatement, we recognized additional pre-tax
income/(loss) of $83 million, $(5) million, and $(54) million in
2005, 2004, and 2003, respectively.
|
·
|
Marketing
incentives: We recorded out-of-period adjustments to correct duplicative
reserves for vehicle residual values and for certain employee and
supplier
discount plans that were recognized at point of retail sale rather
than
when we sold the vehicle to the dealer. As part of our restatement,
we
recognized additional pre-tax income/(loss) of $(11) million,
$(9) million, and $128 million in 2005, 2004, and 2003,
respectively.
|
·
|
Marketing
expenses: We recorded an out-of-period adjustment primarily to record
marketing costs (advertising and sales promotions) that had been
accrued
prior to services being rendered. As part of our restatement, we
recognized additional pre-tax income/(loss) of $(107) million and
$1
million in 2004 and 2003,
respectively.
|
· |
In
addition to the items listed above, during the affected periods,
we also
recorded many other less-significant out-of-period adjustments,
which
totaled $(1) million, $83 million, and $185 million, $(92) million,
and
$(117) million in 2005, 2004, and 2003, respectively. Nearly all
of these
adjustments were recorded in
Cost of
sales
.
|
For
the Years Ended December 31,
|
|||||||||||||||||||
2005
|
2004
|
2003
|
|||||||||||||||||
Previously
Reported
|
Restated
|
Previously
Reported
|
Restated
|
Previously
Reported
|
Restated
|
||||||||||||||
Cash
flows from operating activities of continuing operations
|
|||||||||||||||||||
Net
cash flows from operating activities (Note 21)
|
$
|
21,674
|
$
|
20,387
|
$
|
24,562
|
$
|
21,683
|
$
|
17,256
|
$
|
15,573
|
|||||||
Cash
flows from investing activities of continuing operations
|
|||||||||||||||||||
Capital
expenditures
|
(7,517
|
)
|
(7,517
|
)
|
(6,738
|
)
|
(6,738
|
)
|
(7,726
|
)
|
(7,726
|
)
|
|||||||
Acquisitions
of retail and other finance receivables and operating
leases
|
(54,024
|
)
|
(54,024
|
)
|
(63,284
|
)
|
(63,284
|
)
|
(59,503
|
)
|
(59,503
|
)
|
|||||||
Collections
of retail and other finance receivables and operating
leases
|
48,238
|
48,257
|
51,024
|
51,002
|
44,476
|
44,472
|
|||||||||||||
Net
acquisitions of daily rental vehicles
|
(1,552
|
)
|
(1,552
|
)
|
(2,492
|
)
|
(2,192
|
)
|
(1,505
|
)
|
(1,517
|
)
|
|||||||
Purchases
of securities
|
(6,278
|
)
|
(11,883
|
)
|
(8,470
|
)
|
(11,767
|
)
|
(10,074
|
)
|
(22,020
|
)
|
|||||||
Sales
and maturities of securities
|
6,154
|
8,735
|
8,414
|
16,648
|
9,382
|
16,433
|
|||||||||||||
Proceeds
from sales of retail and other finance receivables and operating
leases
|
17,288
|
17,288
|
6,481
|
6,481
|
18,401
|
18,401
|
|||||||||||||
Proceeds
from sale of businesses
|
7,937
|
7,937
|
537
|
537
|
1,702
|
1,702
|
|||||||||||||
Transfer
of cash balances upon disposition of discontinued/held-for-sale
operations
|
(1,255
|
)
|
(1,255
|
)
|
(39
|
)
|
(39
|
)
|
(10
|
)
|
(10
|
)
|
|||||||
Cash
paid for acquisitions
|
(2,031
|
)
|
(2,031
|
)
|
(30
|
)
|
(30
|
)
|
—
|
—
|
|||||||||
Cash
recognized on initial consolidation of joint ventures
|
—
|
—
|
—
|
—
|
256
|
256
|
|||||||||||||
Other
|
497
|
1,849
|
(364
|
)
|
2,292
|
1,599
|
3,304
|
||||||||||||
Net
cash (used in)/provided by investing activities
|
7,457
|
5,804
|
(14,961
|
)
|
(7,090
|
)
|
(3,002
|
)
|
(6,208
|
)
|
|||||||||
Cash
flows from financing activities of continuing operations
|
|||||||||||||||||||
Cash
dividends
|
(738
|
)
|
(738
|
)
|
(733
|
)
|
(733
|
)
|
(733
|
)
|
(733
|
)
|
|||||||
Net
sales/(purchases) of Common Stock
|
325
|
325
|
(151
|
)
|
(151
|
)
|
9
|
9
|
|||||||||||
Changes
in short-term debt
|
(8,591
|
)
|
(8,713
|
)
|
4,937
|
4,885
|
1,305
|
1,286
|
|||||||||||
Proceeds
from issuance of other debt
|
24,559
|
24,559
|
22,223
|
22,223
|
23,086
|
23,086
|
|||||||||||||
Principal
payments on other debt
|
(36,080
|
)
|
(36,080
|
)
|
(36,000
|
)
|
(36,000
|
)
|
(28,765
|
)
|
(28,765
|
)
|
|||||||
Other
|
(126
|
)
|
(153
|
)
|
(120
|
)
|
(136
|
)
|
(82
|
)
|
(98
|
)
|
|||||||
Net
cash (used in)/provided by financing activities
|
(20,651
|
)
|
(20,800
|
)
|
(9,844
|
)
|
(9,912
|
)
|
(5,180
|
)
|
(5,215
|
)
|
|||||||
Effect
of exchange rate changes on cash
|
(496
|
)
|
(496
|
)
|
505
|
505
|
811
|
811
|
|||||||||||
Net
increase/(decrease) in cash and cash equivalents from continuing
operations
|
7,984
|
4,895
|
262
|
5,186
|
9,885
|
4,961
|
|||||||||||||
Cash
from discontinued operations
|
|||||||||||||||||||
Cash
flows from operating activities of discontinued operations
|
54
|
54
|
316
|
316
|
308
|
308
|
|||||||||||||
Cash
flows from investing activities of discontinued operations
|
(49
|
)
|
(49
|
)
|
(320
|
)
|
(320
|
)
|
(280
|
)
|
(280
|
)
|
|||||||
Cash
flows from financing activities of discontinued operations
|
—
|
—
|
—
|
—
|
(6
|
)
|
(6
|
)
|
|||||||||||
Net
increase/(decrease) in cash and cash equivalents
|
$
|
7,989
|
$
|
4,900
|
$
|
258
|
$
|
5,182
|
$
|
9,907
|
$
|
4,983
|
|||||||
Cash
and cash equivalents at January 1
|
$
|
22,831
|
$
|
22,831
|
$
|
22,599
|
$
|
17,675
|
$
|
13,124
|
$
|
13,124
|
|||||||
Cash
and cash equivalents of discontinued/held-for-sale operations at
January
1
|
679
|
679
|
653
|
653
|
221
|
221
|
|||||||||||||
Net
increase/(decrease) in cash and cash equivalents
|
7,989
|
4,900
|
258
|
5,182
|
9,907
|
4,983
|
|||||||||||||
Less:
cash and cash equivalents of discontinued/held-for-sale operations
at
December 31
|
—
|
—
|
(679
|
)
|
(679
|
)
|
(653
|
)
|
(653
|
)
|
|||||||||
Cash
and cash equivalents at December 31
|
$
|
31,499
|
$
|
28,410
|
$
|
22,831
|
$
|
22,831
|
$
|
22,599
|
$
|
17,675
|
Automotive
|
Financial
Services
|
Automotive
|
Financial
Services
|
||||||||||
Previously
Reported
|
Previously
Reported
|
Restated
|
Restated
|
||||||||||
Cash
flows from operating activities of continuing operations
|
|||||||||||||
Net
cash flows from operating activities (Note 21)
|
$
|
5,436
|
$
|
9,384
|
$
|
5,433
|
$
|
6,912
|
|||||
Cash
flows from investing activities of continuing operations
|
|||||||||||||
Capital
expenditures
|
(7,123
|
)
|
(394
|
)
|
(7,123
|
)
|
(394
|
)
|
|||||
Acquisitions
of retail and other finance receivables and operating
leases
|
—
|
(54,024
|
)
|
—
|
(54,024
|
)
|
|||||||
Collections
of retail and other finance receivables and operating
leases
|
—
|
48,226
|
—
|
48,245
|
|||||||||
Net
(increase)/decrease in wholesale receivables
|
—
|
3,563
|
—
|
4,751
|
|||||||||
Net
acquisitions of daily rental vehicles
|
—
|
(1,988
|
)
|
—
|
(1,988
|
)
|
|||||||
Purchases
of securities
|
(5,714
|
)
|
(564
|
)
|
(5,714
|
)
|
(6,169
|
)
|
|||||
Sales
and maturities of securities
|
5,106
|
1,048
|
5,106
|
3,629
|
|||||||||
Proceeds
from sales of retail and other finance receivables and operating
leases
|
—
|
17,288
|
—
|
17,288
|
|||||||||
Proceeds
from sale of wholesale receivables
|
—
|
3,739
|
—
|
3,739
|
|||||||||
Proceeds
from sale of businesses
|
280
|
7,657
|
280
|
7,657
|
|||||||||
Transfer
of cash balances upon disposition of discontinued/held-for-sale
operations
|
—
|
(1,255
|
)
|
—
|
(1,255
|
)
|
|||||||
Net
investing activity with Financial Services
|
8,407
|
—
|
8,407
|
—
|
|||||||||
Cash
paid for acquisitions
|
(2,031
|
)
|
—
|
(2,031
|
)
|
—
|
|||||||
Cash
recognized on initial consolidation of joint ventures
|
—
|
—
|
—
|
—
|
|||||||||
Other
|
384
|
113
|
387
|
1,462
|
|||||||||
Net
cash (used in)/provided by investing activities
|
(691
|
)
|
23,409
|
(688
|
)
|
22,941
|
|||||||
Cash
flows from financing activities of continuing operations
|
|||||||||||||
Cash
dividends
|
(738
|
)
|
—
|
(738
|
)
|
—
|
|||||||
Net
sales/(purchases) of Common Stock
|
325
|
—
|
325
|
—
|
|||||||||
Changes
in short-term debt
|
(115
|
)
|
(8,476
|
)
|
(115
|
)
|
(8,598
|
)
|
|||||
Proceeds
from issuance of other debt
|
385
|
24,174
|
385
|
24,174
|
|||||||||
Principal
payments on other debt
|
(758
|
)
|
(35,322
|
)
|
(758
|
)
|
(35,322
|
)
|
|||||
Net
financing activity with Automotive
|
—
|
(8,407
|
)
|
—
|
(8,407
|
)
|
|||||||
Other
|
(177
|
)
|
51
|
(177
|
)
|
24
|
|||||||
Net
cash (used in)/provided by financing activities
|
(1,078
|
)
|
(27,980
|
)
|
(1,078
|
)
|
(28,129
|
)
|
|||||
Effect
of exchange rate changes on cash
|
(23
|
)
|
(473
|
)
|
(23
|
)
|
(473
|
)
|
|||||
Net
change in intersector receivables/payables and other
liabilities
|
(394
|
)
|
394
|
(394
|
)
|
394
|
|||||||
Net
increase/(decrease) in cash and cash equivalents from continuing
operations
|
3,250
|
4,734
|
3,250
|
1,645
|
|||||||||
Cash
from discontinued operations
|
|||||||||||||
Cash
flows from operating activities of discontinued operations
|
(17
|
)
|
71
|
(17
|
)
|
71
|
|||||||
Cash
flows from investing activities of discontinued operations
|
17
|
(66
|
)
|
17
|
(66
|
)
|
|||||||
Cash
flows from financing activities of discontinued operations
|
—
|
—
|
—
|
—
|
|||||||||
Net
increase/(decrease) in cash and cash equivalents
|
$
|
3,250
|
$
|
4,739
|
$
|
3,250
|
$
|
1,650
|
|||||
Cash
and cash equivalents at January 1
|
$
|
10,142
|
$
|
12,689
|
$
|
10,142
|
$
|
12,689
|
|||||
Cash
and cash equivalents of discontinued/held-for-sale operations at
January
1
|
—
|
679
|
—
|
679
|
|||||||||
Net
increase/(decrease) in cash and cash equivalents
|
3,250
|
4,739
|
3,250
|
1,650
|
|||||||||
Less:
cash and cash equivalents of discontinued/held-for-sale operations
at
December 31
|
—
|
—
|
—
|
—
|
|||||||||
Cash
and cash equivalents at December 31
|
$
|
13,392
|
$
|
18,107
|
$
|
13,392
|
$
|
15,018
|
|
Automotive
|
Financial
Services
|
Automotive
|
Financial
Services
|
|||||||||
Previously
Reported
|
Previously
Reported
|
Restated
|
Restated
|
||||||||||
Cash
flows from operating activities of continuing operations
|
|||||||||||||
Net
cash flows from operating activities (Note 21)
|
$
|
6,969
|
$
|
15,592
|
$
|
6,963
|
$
|
7,963
|
|||||
Cash
flows from investing activities of continuing operations
|
|||||||||||||
Capital
expenditures
|
(6,280
|
)
|
(458
|
)
|
(6,280
|
)
|
(458
|
)
|
|||||
Acquisitions
of retail and other finance receivables and operating
leases
|
—
|
(63,284
|
)
|
—
|
(63,284
|
)
|
|||||||
Collections
of retail and other finance receivables and operating
leases
|
—
|
51,242
|
—
|
51,220
|
|||||||||
Net
(increase)/decrease in wholesale receivables
|
—
|
(2,174
|
)
|
—
|
2,882
|
||||||||
Net
acquisitions of daily rental vehicles
|
—
|
(2,492
|
)
|
—
|
(2,492
|
)
|
|||||||
Purchases
of securities
|
(7,590
|
)
|
(880
|
)
|
(7,590
|
)
|
(4,177
|
)
|
|||||
Sales
and maturities of securities
|
7,615
|
799
|
7,615
|
9,033
|
|||||||||
Proceeds
from sales of retail and other finance receivables and operating
leases
|
—
|
6,481
|
—
|
6,481
|
|||||||||
Proceeds
from sale of wholesale receivables
|
—
|
3,957
|
—
|
3,957
|
|||||||||
Proceeds
from sale of businesses
|
125
|
412
|
125
|
412
|
|||||||||
Transfer
of cash balances upon disposition of discontinued/held-for-sale
operations
|
(26
|
)
|
(13
|
)
|
(26
|
)
|
(13
|
)
|
|||||
Net
investing activity with Financial Services
|
4,361
|
—
|
4,361
|
—
|
|||||||||
Cash
paid for acquisitions
|
(30
|
)
|
—
|
(30
|
)
|
—
|
|||||||
Cash
recognized on initial consolidation of joint ventures
|
—
|
—
|
—
|
—
|
|||||||||
Other
|
101
|
(465
|
)
|
107
|
2,185
|
||||||||
Net
cash (used in)/provided by investing activities
|
(1,724
|
)
|
(6,875
|
)
|
(1,718
|
)
|
5,746
|
||||||
Cash
flows from financing activities of continuing operations
|
|||||||||||||
Cash
dividends
|
(733
|
)
|
—
|
(733
|
)
|
—
|
|||||||
Net
sales/(purchases) of Common Stock
|
(151
|
)
|
—
|
(151
|
)
|
—
|
|||||||
Changes
in short-term debt
|
(342
|
)
|
5,279
|
(342
|
)
|
5,227
|
|||||||
Proceeds
from issuance of other debt
|
469
|
21,754
|
469
|
21,754
|
|||||||||
Principal
payments on other debt
|
(2,564
|
)
|
(33,436
|
)
|
(2,564
|
)
|
(33,436
|
)
|
|||||
Net
financing activity with Automotive
|
—
|
(4,361
|
)
|
—
|
(4,361
|
)
|
|||||||
Other
|
(39
|
)
|
(81
|
)
|
(39
|
)
|
(97
|
)
|
|||||
Net
cash (used in)/provided by financing activities
|
(3,360
|
)
|
(10,845
|
)
|
(3,360
|
)
|
(10,913
|
)
|
|||||
Effect
of exchange rate changes on cash
|
117
|
388
|
117
|
388
|
|||||||||
Net
change in intersector receivables/payables and other
liabilities
|
1,258
|
(1,258
|
)
|
1,258
|
(1,258
|
)
|
|||||||
Net
increase/(decrease) in cash and cash equivalents from continuing
operations
|
3,260
|
(2,998
|
)
|
3,260
|
1,926
|
||||||||
Cash
from discontinued operations
|
|||||||||||||
Cash
flows from operating activities of discontinued operations
|
(148
|
)
|
464
|
(148
|
)
|
464
|
|||||||
Cash
flows from investing activities of discontinued operations
|
137
|
(457
|
)
|
137
|
(457
|
)
|
|||||||
Cash
flows from financing activities of discontinued operations
|
—
|
—
|
—
|
—
|
|||||||||
Net
increase/(decrease) in cash and cash equivalents
|
$
|
3,249
|
$
|
(2,991
|
)
|
$
|
3,249
|
$
|
1,933
|
||||
Cash
and cash equivalents at January 1
|
$
|
6,856
|
$
|
15,743
|
$
|
6,856
|
$
|
10,819
|
|||||
Cash
and cash equivalents of discontinued/held-for-sale operations at
January
1
|
37
|
616
|
37
|
616
|
|||||||||
Net
increase/(decrease) in cash and cash equivalents
|
3,249
|
(2,991
|
)
|
3,249
|
1,933
|
||||||||
Less:
cash and cash equivalents of discontinued/held-for-sale operations
at
December 31
|
—
|
(679
|
)
|
—
|
(679
|
)
|
|||||||
Cash
and cash equivalents at December 31
|
$
|
10,142
|
$
|
12,689
|
$
|
10,142
|
$
|
12,689
|
|
Automotive
|
Financial
Services
|
Automotive
|
Financial
Services
|
|||||||||
Previously
Reported
|
Previously
Reported
|
Restated
|
Restated
|
||||||||||
Cash
flows from operating activities of continuing operations
|
|||||||||||||
Net
cash flows from operating activities (Note 21)
|
$
|
2,923
|
$
|
16,487
|
$
|
2,955
|
$
|
11,042
|
|||||
Cash
flows from investing activities of continuing operations
|
|||||||||||||
Capital
expenditures
|
(7,347
|
)
|
(379
|
)
|
(7,347
|
)
|
(379
|
)
|
|||||
Acquisitions
of retail and other finance receivables and operating
leases
|
—
|
(59,503
|
)
|
—
|
(59,503
|
)
|
|||||||
Collections
of retail and other finance receivables and operating
leases
|
—
|
44,118
|
—
|
44,114
|
|||||||||
Net
(increase)/decrease in wholesale receivables
|
—
|
(2,762
|
)
|
—
|
956
|
||||||||
Net
acquisitions of daily rental vehicles
|
—
|
(1,505
|
)
|
—
|
(1,505
|
)
|
|||||||
Purchases
of securities
|
(8,925
|
)
|
(1,149
|
)
|
(8,925
|
)
|
(13,095
|
)
|
|||||
Sales
and maturities of securities
|
8,673
|
709
|
8,673
|
7,760
|
|||||||||
Proceeds
from sales of retail and other finance receivables and operating
leases
|
—
|
18,401
|
—
|
18,401
|
|||||||||
Proceeds
from sale of wholesale receivables
|
—
|
966
|
—
|
966
|
|||||||||
Proceeds
from sale of businesses
|
77
|
1,625
|
77
|
1,625
|
|||||||||
Transfer
of cash balances upon disposition of discontinued/held-for-sale
operations
|
(10
|
)
|
—
|
(10
|
)
|
—
|
|||||||
Net
investing activity with Financial Services
|
3,708
|
—
|
3,708
|
—
|
|||||||||
Cash
paid for acquisitions
|
—
|
—
|
—
|
—
|
|||||||||
Cash
recognized on initial consolidation of joint ventures
|
256
|
—
|
256
|
—
|
|||||||||
Other
|
716
|
883
|
684
|
2,620
|
|||||||||
Net
cash (used in)/provided by investing activities
|
(2,852
|
)
|
1,404
|
(2,884
|
)
|
1,960
|
|||||||
Cash
flows from financing activities of continuing operations
|
|||||||||||||
Cash
dividends
|
(733
|
)
|
—
|
(733
|
)
|
—
|
|||||||
Net
sales/(purchases) of Common Stock
|
9
|
—
|
9
|
—
|
|||||||||
Changes
in short-term debt
|
(237
|
)
|
1,542
|
(237
|
)
|
1,523
|
|||||||
Proceeds
from issuance of other debt
|
1,144
|
21,942
|
1,144
|
21,942
|
|||||||||
Principal
payments on other debt
|
(1,082
|
)
|
(27,683
|
)
|
(1,082
|
)
|
(27,683
|
)
|
|||||
Net
financing activity with Automotive
|
—
|
(3,708
|
)
|
—
|
(3,708
|
)
|
|||||||
Other
|
(15
|
)
|
(67
|
)
|
(15
|
)
|
(83
|
)
|
|||||
Net
cash (used in)/provided by financing activities
|
(914
|
)
|
(7,974
|
)
|
(914
|
)
|
(8,009
|
)
|
|||||
Effect
of exchange rate changes on cash
|
260
|
551
|
260
|
551
|
|||||||||
Net
change in intersector receivables/payables and other
liabilities
|
1,186
|
(1,186
|
)
|
1,186
|
(1,186
|
)
|
|||||||
Net
increase/(decrease) in cash and cash equivalents from continuing
operations
|
603
|
9,282
|
603
|
4,358
|
|||||||||
Cash
from discontinued operations
|
|||||||||||||
Cash
flows from operating activities of discontinued operations
|
26
|
282
|
26
|
282
|
|||||||||
Cash
flows from investing activities of discontinued operations
|
(4
|
)
|
(276
|
)
|
(4
|
)
|
(276
|
)
|
|||||
Cash
flows from financing activities of discontinued operations
|
(6
|
)
|
—
|
(6
|
)
|
—
|
|||||||
Net
increase/(decrease) in cash and cash equivalents
|
$
|
619
|
$
|
9,288
|
$
|
619
|
$
|
4,364
|
|||||
Cash
and cash equivalents at January 1
|
$
|
6,243
|
$
|
6,881
|
$
|
6,243
|
$
|
6,881
|
|||||
Cash
and cash equivalents of discontinued/held-for-sale operations at
January
1
|
31
|
190
|
31
|
190
|
|||||||||
Net
increase/(decrease) in cash and cash equivalents
|
619
|
9,288
|
619
|
4,364
|
|||||||||
Less:
cash and cash equivalents of discontinued/held-for-sale operations
at
December 31
|
(37
|
)
|
(616
|
)
|
(37
|
)
|
(616
|
)
|
|||||
Cash
and cash equivalents at December 31
|
$
|
6,856
|
$
|
15,743
|
$
|
6,856
|
$
|
10,819
|
Restated
|
|||||||||||||
Description
|
Balance
at Beginning
of
Period
|
Charged
to Costs and
Expenses
|
Deductions
|
Balance
at End of
Period
|
|||||||||
For
the Year Ended December 31, 2005
|
|||||||||||||
Allowances
Deducted from Assets
|
|
|
|
|
|||||||||
Allowance
for Credit Losses
|
$
|
2,471
|
$
|
167
|
$
|
1,044
|
(a)
|
$
|
1,594
|
||||
Allowance
for Doubtful Receivables
|
988
|
523
|
(b)
|
1,194
|
(c)
|
317
|
(d)
|
||||||
Inventories
(primarily service part obsolescence)
|
376
|
52
|
(e)
|
—
|
428
|
||||||||
Allowance
for Deferred Tax Assets
|
172
|
(f)
|
80
|
(f)
|
—
|
252
|
(f)
|
||||||
Total
Allowances Deducted from Assets
|
$
|
4,007
|
$
|
822
|
$
|
2,238
|
$
|
2,591
|
|||||
For
the Year Ended December 31, 2004
|
|||||||||||||
Allowances
Deducted from Assets
|
|||||||||||||
Allowance
for Credit Losses
|
$
|
2,977
|
(f)
|
$
|
923
|
$
|
1,429
|
(a)
(f)
|
$
|
2,471
|
|||
Allowance
for Doubtful Receivables
|
384
|
663
|
(b)
|
59
|
(c)
|
988
|
(d)
|
||||||
Inventories
(primarily service part obsolescence)
|
368
|
8
|
(e)
|
—
|
376
|
||||||||
Allowance
for Deferred Tax Assets
|
105
|
(f)
|
67
|
(f)
|
—
|
172
|
(f)
|
||||||
Total
Allowances Deducted from Assets
|
$
|
3,834
|
$
|
1,661
|
$
|
1,488
|
$
|
4,007
|
|||||
For
the Year Ended December 31, 2003
|
|||||||||||||
Allowances
Deducted from Assets
|
|||||||||||||
Allowance
for Credit Losses
|
$
|
3,065
|
(f)
|
$
|
1,928
|
$
|
2,016
|
(a)
(f)
|
$
|
2,977
|
(f)
|
||
Allowance
for Doubtful Receivables
|
374
|
108
|
98
|
(c)
|
384
|
||||||||
Inventories
(primarily service part obsolescence)
|
304
|
64
|
(e)
|
—
|
368
|
||||||||
Allowance
for Deferred Tax Assets
|
50
|
55
|
(f)
|
—
|
105
|
(f)
|
|||||||
Total
Allowances Deducted from Assets
|
$
|
3,793
|
$
|
2,155
|
$
|
2,114
|
$
|
3,834
|
(a)
|
Finance
receivables and lease investments deemed to be uncollectible and
other
changes, principally amounts related to finance receivables sold
and
translation adjustments.
|
(b)
|
Includes
Visteon-related increases of $500 million and $600 million in 2005
and
2004, respectively.
|
(c)
|
Accounts
and notes receivable deemed to be uncollectible and translation
adjustments. Included in 2005 is a write-off of Visteon-related
receivables of $1.1 billion.
|
(d)
|
Includes
non-current Visteon-related receivables of $19 million and $600 million
at
December 31, 2005 and 2004, respectively, which are netted against
Automotive
— Other assets
on
the sector balance sheet.
|
(e)
|
Net
change in inventory allowances.
|
(f)
|
Amounts
have been restated due to the effect of the restatement discussed
in Note
28 of the Notes to the Financial
Statements.
|
Annual
Board membership fee
|
$
|
200,000
|
||
Annual
Committee chair fee
|
$
|
5,000
|
||
Annual
Presiding Director fee
|
$
|
10,000
|
AUTHENTICATED
as
of the above date
By_________________________________
Executive
Compensation Human Resources
|
FORD
MOTOR COMPANY
By
____________________________
Executive
Vice President and Chief Financial Officer
Optionee:
«First_MI»
«Last_name»
__
Optionee
ID: ____________________
By
____________________________
Manager
Compensation Programs
|
1.
|
The
Option may not be exercised prior to the date one year from the date
of
the Stock Option Agreement of which these terms and conditions are
a part
(the Agreement). Thereafter, the Option may be exercised in installments
as follows:
(a)
Beginning on the date one year from the date of the Agreement, the
Option
may be exercised to the extent of 33% of the shares originally covered
thereby;
(b)
Beginning on the date two years from the date of the Agreement, the
Option
may be exercised to the extent of an additional 33% of the shares
originally covered thereby;
(c)
Beginning on the date three years from the date of the Agreement,
the
Option may be exercised to the extent of an additional 34% of the
shares
originally covered thereby; and
(d)
To the extent not exercised, installments shall be cumulative and
may be
exercised in whole or in part;
all
subject to the Agreement and these terms and conditions and any rules
and
regulations established by the Committee pursuant to the
Plan.
Notwithstanding
the foregoing, if your stock option grant included an incentive stock
option (ISO), the ISO portion of the grant would be maximized within
permissible regulatory limits. This could result in a different number
of
options vesting on the first three anniversary dates of the grant
under
the nonqualified option (NQO) and/or the ISO portion of the grant
than the
number indicated by the schedule above. In any event, the total number
of
NQOs and ISOs in the grant, will, as a whole, vest according to the
schedule above. Your account statement (available online through
a Smith
Barney phone representative and mailed to you annually) will reflect
the
specific number of ISOs and NQOs vesting on the specific
dates.
|
2.
|
The
Stock Appreciation Right, if any, granted by the Company to the Optionee
under the Agreement shall entitle the Optionee to receive, without
payment
to the Company and as the Optionee may elect, either (a) that number
of
shares of Stock determined by dividing (i) the total number of shares
of
Stock subject to the Option (or the portion or portions thereof which
the
Optionee from time to time elects to use for purposes of this clause
(a)),
multiplied by the amount by which the fair market value of a share
of
Stock on the day this right is exercised exceeds the option price
set
forth in the Agreement (such amount being hereinafter referred to
as the
Spread), by (ii) the fair market value of a share of Stock on the
exercise
date; or (b) cash in an amount determined by multiplying (i) the
total
number of shares of Stock subject to the Option (or the portion or
portions thereof which the Optionee from time to time elects to use
for
purposes of this clause (b)), by (ii) the amount of the Spread; or
(c) a
combination of shares of Stock and cash, in amounts determined as
set
forth in clauses (a) and (b) above; all subject to the terms and
conditions set forth herein and any rules and regulations established
by
the Committee pursuant to the Plan.
The
right of the Optionee to exercise any Stock Appreciation Right shall
be
cancelled if and to the extent that the Option is exercised. The
right of
the Optionee to exercise the Option shall be cancelled if and to
the
extent that shares covered by the Option are used to calculate shares
or
cash received upon exercise of any Stock Appreciation Right.
Fair
market value shall mean the average of the highest price and the
lowest
price at which Stock shall have been sold regular way on the New
York
Stock Exchange on the date as of which such computation is to be
made or,
if no such sales shall have been made on such day, on the next preceding
day on which there were such sales of Stock on such Exchange.
If
any fractional share of Stock would otherwise be deliverable to the
Optionee upon exercise of any Stock Appreciation Right, the Optionee
shall
be paid a cash amount equal to the same fraction of the fair market
value
of the Stock on the date of exercise.
Any
Stock Appreciation Right shall become and remain exercisable by the
Optionee only to the extent that the Option becomes and remains
exercisable.
|
3.
|
Except
as provided in the two paragraphs next following, if, prior to the
date
one year from the date of the Agreement, the Optionee's employment
with
the Company shall be terminated by the Company, with or without cause,
or
by the act, death, incapacity or retirement of the Optionee, the
Optionee's right to exercise the Option and any Stock Appreciation
Right
shall terminate on the date of such termination of employment and
all
rights hereunder and under the Agreement shall cease.
Notwithstanding
the provisions of the next preceding paragraph, if the Optionee's
employment with the Company shall be terminated by reason of retirement,
release because of disability or death, and the Optionee had remained
in
the employ of the Company for at least six months following the date
of
the Agreement, and subject to the provisions of Article 4 hereof,
all the
Optionee's rights hereunder and under the Agreement shall continue
in
effect or continue to accrue until the date ten years after the date
of
the Agreement, subject, in the event of the Optionee's death during
such
ten-year period, to the provisions of the sixth paragraph of this
Article
and subject to any other limitation contained herein or in the Agreement
on the exercise of the Option or any Stock Appreciation Right in
effect at
the date of exercise.
Notwithstanding
anything to the contrary set forth herein or in the Agreement, if
the
Optionee's employment with the Company shall be terminated at any
time by
reason of a sale or other disposition (including, without limitation,
a
transfer to a Joint Venture (as hereinafter defined)) of the division,
operation or subsidiary in which the Optionee was employed or to
which the
Optionee was assigned, all the Optionee's rights under the Option
and any
Stock Appreciation Right granted to him or her shall become immediately
exercisable and continue in effect until the date five years after
the
date of such termination (but not later than the date ten years from
the
date of grant of the Option), provided the Optionee shall satisfy
both of
the following conditions:
(a)
the Optionee, at the date of such termination, had remained in the
employ
of the Company for at least three months following the grant of the
Option
and any Stock Appreciation Right, and
(b)
the Optionee continues to be or becomes employed in such division,
operation or subsidiary following such sale or other disposition
and
remains in such employ until the date of exercise of the Option or
any
Stock Appreciation Right (unless the Committee, or any committee
appointed
by it for the purpose, shall waive this condition (b)).
Upon
termination of the Optionee's employment with such (former) division,
operation or subsidiary following such sale or other disposition,
any then
existing right of the Optionee to exercise the Option or any Stock
Appreciation Right shall be subject to the following limitations:
(i) if
the Optionee's employment is terminated by reason of disability,
death or
retirement with the approval of his or her employer, the Optionee's
rights
shall continue as provided in the preceding sentence with the same
effect
as if his or her employment had not terminated; (ii) if the Optionee's
employment is terminated by reason of discharge or voluntary quit,
the
Optionee's rights shall terminate on the date of such termination
of
employment and all rights under the Option and any Stock Appreciation
Right shall cease; and (iii) if the Optionee's employment is terminated
for any reason other than a reason set forth in the preceding clauses
(i)
and (ii), the Optionee shall have the right, within three months
after
such termination, to exercise the Option or any Stock Appreciation
Right
to the extent that it or any installment thereof shall have accrued
at the
date of such termination and shall not have been exercised, subject
in the
case of any such termination to the provisions of Article 4 hereof
and any
other limitation on the exercise of the Option and any Stock Appreciation
Right in effect at the date of exercise. For purposes of this paragraph,
the term Joint Venture shall mean any joint venture corporation or
partnership, or comparable entity, in which the Company has a substantial
equity interest.
If,
on or after the date one year from the date of the Agreement, the
Optionee's employment with the Company shall be terminated for any
reason
except retirement, release because of disability, death, release
because
of a sale or other disposition of the division, operation or subsidiary
in
which the Optionee was employed or to which the Optionee was assigned,
discharge, release in the best interest of the Company or voluntary
quit,
the Optionee shall have the right, within three months after such
termination, to exercise the Option or any Stock Appreciation Right
to the
extent that it or any installment thereof shall have accrued at the
date
of such termination of employment and shall not have been exercised,
subject to the provisions of Article 4 hereof and any other limitation
contained herein or in the Agreement on the exercise of the Option
or any
Stock Appreciation Right in effect at the date of exercise.
If
the Optionee's employment with the Company shall be terminated at
any time
by reason of discharge, release in the best interest of the Company
or
voluntary quit, the Optionee's right to exercise the Option or any
Stock
Appreciation Right shall terminate on the date of such termination
of
employment and all rights hereunder and under the Agreement shall
cease.
If
the Optionee shall die within the applicable period specified in
the
second, third or fourth paragraph of this Article, the beneficiary
designated pursuant to Article 7 hereof or, if no such designation
is in
effect, the executor or administrator of the estate of the decedent
or the
person or persons to whom the Option or any Stock Appreciation Right
shall
have been validly transferred by the executor or the administrator
pursuant to will or the laws of descent and distribution shall have
the
right, within the same period of time as the period during which
the
Optionee would have been entitled to exercise the Option or any Stock
Appreciation Right if the Optionee had not died, to exercise the
Option or
any Stock Appreciation Right (except that, if the fourth paragraph
of this
Article shall apply to the Optionee, the Option or any Stock Appreciation
Right may be exercised only to the extent that it or any installment
thereof shall have accrued at the date of death and shall not have
been
exercised, and except that the period of time within which the Option
or
any Stock Appreciation Right shall be exercisable following the date
of
the Optionee's death shall not be less than one year (unless the
Option by
its terms expires earlier)), subject to the provision that neither
the
Option nor any Stock Appreciation Right shall be exercised under
any
circumstances beyond ten years from the date of the Agreement and
to any
other limitation on the exercise of the Option or any Stock Appreciation
Right in effect at the date of exercise.
Notwithstanding
anything to the contrary set forth in the Agreement or in these terms
and
conditions, neither the Option nor any Stock Appreciation Right shall
be
exercised on or after the date ten years from the date of the
Agreement.
|
4.
|
Anything
contained herein or in the Agreement to the contrary notwithstanding,
the
right of the Optionee to exercise the Option or any Stock Appreciation
Right following termination of the Optionee's employment with the
Company
shall remain effective only if, during the entire period from the
date of
the Optionee's termination to the date of such exercise, the Optionee
shall have earned out such right by (i) making himself or herself
available, upon request, at reasonable times and upon a reasonable
basis,
to consult with, supply information to and otherwise cooperate with
the
Company or any subsidiary thereof with respect to any matter that
shall
have been handled by him or her or under his or her supervision while
he
or she was in the employ of the Company or of any subsidiary thereof,
and
(ii) refraining from engaging in any activity that is directly or
indirectly in competition with any activity of the Company or any
subsidiary thereof.
In
the event of the Optionee's nonfulfillment of the condition set forth
in
the immediately preceding paragraph, the Optionee's right to exercise
the
Option or any Stock Appreciation Right shall cease; provided, however,
that the nonfulfillment of such condition may at any time (whether
before,
at the time of or subsequent to termination of his or her employment)
be
waived in the following manner:
(1)
if the Optionee at any time shall have been subject to the reporting
requirements of Section 16(a) of the Securities Exchange Act of 1934,
as
amended (the Exchange Act) or the liability provisions of Section
16(b) of
the Exchange Act (any such Optionee being hereinafter called a Section
16
Person), such waiver may be granted by the Committee upon its
determination that in its sole judgment there shall not have been
and will
not be any substantial adverse effect upon the Company or any subsidiary
thereof by reason of the nonfulfillment of such condition;
and
(2)
if the Optionee shall not at any time have been a Section 16 Person,
such
waiver may be granted by the Committee (or any committee appointed
by it
for the purpose) upon its determination that in its sole judgment
there
shall not have been and will not be any such substantial adverse
effect.
Anything
contained herein or in the Agreement to the contrary notwithstanding,
the
right of the Optionee to exercise the Option or any Stock Appreciation
Right following termination of the Optionee's employment with the
Company
shall cease on and as of the date on which it has been determined
by the
Committee that the Optionee at any time (whether before or subsequent
to
termination of the Optionee's employment) acted in a manner inimical
to
the best interests of the Company. Conduct which constitutes engaging
in
an activity that is directly or indirectly in competition with any
activity of the Company or any
subsidiary
thereof shall be governed by the four immediately preceding paragraphs
of
this Article and shall not be subject to any determination under
this
paragraph.
|
5.
|
Payment
for any shares of Stock purchased upon exercise of the Option shall
be
made in full at the time of exercise. Such payment may be made in
cash, by
wire, by delivery of shares of Stock beneficially owned by the Optionee
or
by a combination of cash and Stock, at the election of the Optionee;
provided, however, that any shares of Stock so delivered shall have
been
beneficially owned by the Optionee for a period of not less than
six
months prior to the date of such exercise. Any shares of Stock so
delivered shall be valued at their fair market value (determined
as
provided in Article 2 hereof) on the date of such exercise.
The
Optionee, from time to time during the period when the Option and
any
Stock Appreciation Right may by their terms be exercised (a) may
exercise
the Option in whole or in part by delivering to the Company or its
designee (i) a written notice signed by the Optionee stating the
number of
shares that the Optionee has elected to purchase at that time from
the
Company, and (ii) a check in an amount, or (in accordance with the
preceding paragraph) shares of Stock having a value, equal to the
purchase
price of the shares then to be purchased, or a combination of shares
of
Stock and cash, or (b) may exercise any Stock Appreciation Right
in whole
or in part by delivering to the Company a written notice signed by
the
Optionee stating (i) the number of shares covered by the Option he
or she
has elected to use to compute the number of shares, and/or (ii) the
number
of shares covered by the Option he or she has elected to use to compute
the amount of cash, to be received from the Company pursuant to exercise
of any Stock Appreciation Right. The Committee, if it shall deem
it
necessary or desirable for any reason connected with any law or regulation
of any governmental authority relating to the regulation of securities,
may require the Optionee to execute and file with it such evidence
as it
may deem necessary that the Optionee is acquiring any shares of Stock
for
investment and not with a view to their distribution and, by way
of the
adoption of rules and regulations or otherwise, impose conditions
as to
the time and manner of exercise of any Stock Appreciation Right by
any
person or class of persons.
As
soon as practicable after receipt by the Company or its designee
of such
notice, check and/or shares of Stock (if the Option is exercised
in whole
or in part) and such evidence of intent to acquire for investment
as may
be required by the Committee, the Company shall issue the appropriate
number of shares in the name of the Optionee and deliver the certificate
therefor to the Optionee and/or deliver a check payable to the order
of
the Optionee for the appropriate amount of cash. The number of shares
shall be adjusted appropriately, or other appropriate arrangements
shall
be made, for any taxes required to be withheld by federal, state
or local
law.
|
6.
|
As
a condition of the granting of the Option and any Stock Appreciation
Right, the Optionee and the Optionee's successors and assigns agree
that
any dispute or disagreement which shall arise under or as a result
of the
Agreement or these terms and conditions shall be determined by the
Committee in its sole discretion and judgment and that any such
determination and any interpretation by the Committee of the Agreement
or
of these terms and conditions shall be final and shall be binding
and
conclusive for all purposes.
|
7.
|
Unless
the Committee determines otherwise, neither the Option nor any Stock
Appreciation Right is transferable by the Optionee otherwise than
by will
or the laws of descent and distribution, and, during the Optionee's
lifetime, each is exercisable only by the Optionee or the Optionee's
guardian or legal representative. Once transferred by will or by
the laws
of descent and distribution, neither the Option nor any Stock Appreciation
Right shall be further transferable. Any transferee of the Option
and any
Stock Appreciation Right shall take the same subject to the terms
and
conditions set forth herein. No such transfer of the Option and any
Stock
Appreciation Right shall be effective to bind the Company unless
the
Company shall have been furnished with written notice thereof and
a copy
of the will and/or such other evidence as the Committee may deem
necessary
to establish the validity of the transfer and the acceptance by the
transferee or transferees of the terms and conditions set forth herein.
No
assignment or transfer of the Option and any Stock Appreciation Right,
or
of the rights represented thereby, other than as provided in this
Article,
shall vest in the purported assignee or transferee any interest or
right
therein whatsoever.
Notwithstanding
anything to the contrary set forth herein, the Optionee may file
with the
Company or its designee a written designation of beneficiary or
beneficiaries (subject to such limitations as to the classes and
number of
beneficiaries and contingent beneficiaries and such other limitations
as
the Committee from time to time may prescribe) to exercise, in the
event
of the Optionee's death, the Option or any Stock Appreciation Right
subject to the terms and conditions set forth herein and to receipt
by the
Company of such evidence as the Committee may deem necessary to establish
the acceptance by the beneficiary or beneficiaries of the terms and
conditions set forth herein. The Optionee shall be deemed to have
designated as beneficiary or beneficiaries the person or persons
who
receive the Optionee's life insurance proceeds under the basic Company
Life Insurance Plan unless the Optionee shall have assigned such
life
insurance or shall have filed with the Company a written designation
of a
different beneficiary or beneficiaries. The Optionee may from time
to time
revoke or change any such designation of beneficiary and any designation
of beneficiary by the Optionee shall be controlling over any other
disposition, testamentary or otherwise; provided, however, that if
the
Committee shall be in doubt as to the entitlement of any such beneficiary
to exercise the Option or any Stock Appreciation Right, the Committee
may
determine to recognize only an exercise by the legal representative
of the
Optionee, in which case the Company, the Committee and the members
thereof
shall not be under any further liability to anyone.
|
8.
|
The
Optionee, a beneficiary designated pursuant to Article 7 hereof or
a
transferee of the Option and any Stock Appreciation Right shall have
no
rights as a stockholder with respect to any share covered by the
Option or
any Stock Appreciation Right until such person shall have become
the
holder of record of such share, and, except as provided in Article
10
hereof, no adjustment shall be made for dividends (ordinary or
extraordinary, whether in cash or securities or other property) or
distributions or other rights in respect of such share for which
the
record date is prior to the date upon which such person shall become
the
holder of record thereof.
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9.
|
The
existence of the Option or any Stock Appreciation Right shall not
affect
in any way the right or power of the Company or its stockholders
to make
or authorize any adjustments, recapitalizations, reorganizations
or other
changes in the Company's capital structure or its business, or any
merger
or consolidation of the Company, or any issue of bonds, debentures,
preferred or prior preference stocks ahead of or affecting the Stock
or
the rights thereof, or the dissolution or liquidation of the Company,
or
any sale or transfer of all or any part of its assets or business,
or any
other corporate act or proceedings whether of a similar character
or
otherwise.
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10.
|
The
shares covered by the Option and any Stock Appreciation Right are
shares
of Stock as presently constituted, but if, and whenever, prior to
the
delivery by the Company of all of the shares of Stock and/or cash
deliverable upon exercise of the Option or any Stock Appreciation
Right,
the Company shall effect the payment of a stock dividend on Stock
payable
in shares of Stock, a subdivision or combination of the shares of
Stock,
or a reclassification of Stock, the number and price of shares remaining
under the Option and any Stock Appreciation Right shall be appropriately
adjusted. Such adjustment shall be made by the Committee, whose
determination as to what adjustment shall be made, and the extent
thereof,
shall be final and shall be binding and conclusive for all purposes.
Any
such adjustment may provide for the elimination of any fractional
share
which might otherwise become subject to the Option.
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11.
|
Except
as hereinbefore expressly provided, (a) the issue by the Company
of shares
of Stock of any class, or securities convertible into shares of Stock
of
any class, for cash or property or for labor or services, either
upon
direct sale or upon the exercise of rights or warrants to subscribe
therefor, or upon conversion of shares or obligations of the Company
convertible into such shares or other securities, or (b) the payment
of a
stock dividend on any other class of the Company's stock, or (c)
any
subdivision or combination of the shares of any other class of the
Company's stock, or (d) any reclassification of any other class of
the
Company's stock, shall not affect, and no adjustment by reason thereof
shall be made with respect to, the number or price of shares of Stock
subject to the Option or any Stock Appreciation Right.
|
12.
|
After
any merger of one or more corporations into the Company, or after
any
consolidation of the Company and one or more corporations in which
the
Company shall be the surviving corporation, the Optionee shall, at
no
additional cost, be entitled upon any exercise of the Option or any
exercise of any Stock Appreciation Right for Stock, to receive (subject
to
any required action by stockholders), in lieu of the number of shares
as
to which the Option or any Stock Appreciation Right shall then be
so
exercised, the number and class of shares of stock or other securities
to
which the Optionee would have been entitled pursuant to the terms
of the
agreement of merger or consolidation if at the time of such merger
or
consolidation the Optionee had been a holder of record of a number
of
shares of Stock equal to the number of shares as to which such Option
or
Stock Appreciation Right shall then be so exercised. Comparable rights
shall accrue to the Optionee in the event of successive mergers or
consolidations of the character described above or in the event of
any
exercise of any Stock Appreciation Right for cash following any such
merger or consolidation. Anything contained herein or in the Agreement
to
the contrary notwithstanding, upon the dissolution or liquidation
of the
Company, or upon any merger or consolidation in which the Company
is not
the surviving corporation, the Option and any Stock Appreciation
Right
shall terminate; but if a period of one year from the date of the
Agreement shall have expired, the Optionee shall have the right,
immediately prior to such dissolution, liquidation, merger or
consolidation, to exercise the Option or any Stock Appreciation Right
in
whole or in part to the extent it shall not have been exercised,
without
regard to the installment provisions of Article 1 hereof but subject
to
any other limitation contained herein or in the Agreement on the
exercise
of the Option and any Stock Appreciation Right in effect on the date
of
exercise. In the event of any other event affecting Stock, an appropriate
adjustment shall be made in the number and price of shares remaining
under, and other terms and provisions of, the Option and any Stock
Appreciation Right. The foregoing adjustments and the manner of
application of the foregoing provisions shall be determined by the
Committee in its sole discretion, and such determination shall be
final
and shall be binding and conclusive for all purposes. Any such adjustment
may provide for the elimination of any fractional share which might
otherwise become subject to the Option.
|
13.
|
Optionee
acknowledges and agrees that, in order for the Company to perform
its
requirements under the Plan, the Company may process, for an indefinite
period of time, personal data about Optionee. Such data includes,
but is
not limited to, the information provided in the Option grant materials
and
any changes thereto, and other appropriate personal data about Optionee,
including information about Optionee's participation in the Plan
and
options exercised under the Plan from time to time. Optionee also
hereby
gives for an indefinite period of time Optionee's explicit consent
to the
Company to collect, use, store and transfer any such personal data
for use
in the United States of America or any other required location. The
legal
persons for whom the personal data is intended include Ford and any
of its
subsidiaries, the outside plan administrator as selected by the Company
from time to time and any other person that the Company may deem
appropriate in its administration of the Plan. Optionee has been
informed
of Optionee's right to access and correct Optionee's personal data
by
contacting Optionee's local Human Resources Representative. Optionee
has
been informed of Optionee's right to withdraw at any time Optionee's
consent to the processing of personal data. Optionee has been informed
that the provision of personal data is voluntary. Optionee understands
that the transfer of the information outlined here is important to
the
administration of the Plan. Optionee's consent is given freely and
is
valid as long as it is needed for administration of the Plan or to
comply
with applicable legal requirements. Optionee's failure to consent
to the
Company's collection, use, storage and transfer of such personal
data may
limit Optionee's right to participate in the Plan. For purposes of
this
paragraph, the term "Company" shall be deemed to include Ford Motor
Company, Optionee's employer, and any other affiliate of Ford Motor
Company involved in the administration of the
Plan.
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14.
|
Optionee
acknowledges that the Company is entitled to terminate the Plan
unilaterally, and Optionee hereby waives any right to receive Plan
benefits in the event that the Plan is terminated or Optionee's right
to
exercise the Option otherwise terminates under the terms of the Agreement.
Optionee further acknowledges that the Company's grant of the option
to
Optionee is not an element of the Optionee's compensation and that
the
option is awarded in the Company's discretion. Optionee further
acknowledges
that receipt of the Option does not entitle Optionee to any further
grants
of an Option in the future, and that the Company does not guarantee
that
benefits under the Plan will have a particular value or be granted
to
Optionee in the future.
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15.
|
Notwithstanding
any of the other provisions of the Agreement or these terms and
conditions, the Optionee agrees not to exercise the Option or any
Stock
Appreciation Right, and that the Company will not be obligated to
issue
any shares or deliver any cash pursuant to the Agreement, if the
exercise
of the Option or any Stock Appreciation Right or the issuance of such
shares or delivery of such cash would constitute a violation by the
Optionee or by the Company of any provisions of any law or regulation
of
any governmental authority. Any determination of the Committee in
this
connection shall be final and shall be binding and conclusive for
all
purposes. The Company shall in no event be obligated to take any
affirmative action in order to cause the exercise of the Option or
any
Stock Appreciation Right or the issuance of shares or delivery of
cash
pursuant thereto to comply with any law or any regulation of any
governmental authority.
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16.
|
Every
notice relating to the Agreement shall be in writing and shall be
given by
registered mail with return receipt requested. All notices to the
Company
shall be addressed to:
Smith
Barney, Inc.
Ford
Service Center
1001
Page Mill Road
Bldg.
4, Suite 101
Palo
Alto, CA 94304, USA
Phone
No.: 877-664-FORD (3673) (U.S.), 212-615-7009 (Non-U.S.),
Fax
No.: 650-494-2561
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17.
|
Whenever
the term Optionee is used in any provision of the Agreement or these
terms
and conditions under circumstances such that the provision should
logically apply to any other person or persons designated as a beneficiary
pursuant to the provisions of Article 7 hereof, or to whom the Option
and
any Stock Appreciation Right, in accordance with the provisions of
Article
7 hereof, may be transferred, the term Optionee shall be deemed to
include
such person or persons.
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18.
|
The
Agreement has been made in and it and these terms and conditions
shall be
construed in accordance with the laws of the State of
Michigan.
|
AUTHENTICATED
as
of the above date
By_________________________________
Executive
Compensation Human Resources
|
FORD
MOTOR COMPANY
By
____________________________
Executive
Vice President and Chief Financial Officer
Optionee:
«First_MI»
«Last_name»
_
Optionee
ID: ____________________
By
____________________________
Manager
Compensation Programs
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1.
|
The
Option may not be exercised prior to the date one year from the date
of
the Stock Option Agreement of which these terms and conditions are
a part
(the "Agreement"). Thereafter, the Option may be exercised in installments
as follows:
(a)
Beginning on the date one year from the date of the Agreement, the
Option
may be exercised to the extent of 33% of the shares originally covered
thereby;
(b)
Beginning on the date two years from the date of the Agreement, the
Option
may be exercised to the extent of an additional 33% of the shares
originally covered thereby;
(c)
Beginning on the date three years from the date of the Agreement,
the
Option may be exercised to the extent of an additional 34% of the
shares
originally covered thereby; and
(d)
To the extent not exercised, installments shall be cumulative and
may be
exercised in whole or in part;
all
subject to the Agreement and these terms and conditions and any rules
and
regulations established by the Committee pursuant to the
Plan.
Notwithstanding
the foregoing, if your stock option grant included an incentive stock
option (ISO), the ISO portion of the grant would be maximized within
permissible regulatory limits. This could result in a different number
of
options vesting on the first three anniversary dates of the grant
under
the nonqualified option (NQO) and/or the ISO portion of the grant
than the
number indicated by the schedule above. In any event, the total number
of
NQOs and ISOs in the grant, will, as a whole, vest according to the
schedule above. Your account statement (available online through
a Smith
Barney phone representative and mailed to you annually) will reflect
the
specific number of ISOs and NQOs vesting on the specific
dates.
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2.
|
The
Stock Appreciation Right, if any, granted by the Company to the Optionee
under the Agreement shall entitle the Optionee to receive, without
payment
to the Company and as the Optionee may elect, either (a) that number
of
shares of Stock determined by dividing (i) the total number of shares
of
Stock subject to the Option (or the portion or portions thereof which
the
Optionee from time to time elects to use for purposes of this clause
(a)),
multiplied by the amount by which the fair market value of a share
of
Stock on the day this right is exercised exceeds the option price
set
forth in the Agreement (such amount being hereinafter referred to
as the
"Spread"), by (ii) the fair market value of a share of Stock on the
exercise date; or (b) cash in an amount determined by multiplying
(i) the
total number of shares of Stock subject to the Option (or the portion
or
portions thereof which the Optionee from time to time elects to use
for
purposes of this clause (b)), by (ii) the amount of the Spread; or
(c) a
combination of shares of Stock and cash, in amounts determined as
set
forth in clauses (a) and (b) above; all subject to the terms and
conditions set forth herein and any rules and regulations established
by
the Committee pursuant to the Plan.
The
right of the Optionee to exercise any Stock Appreciation Right shall
be
cancelled if and to the extent that the Option is exercised. The
right of
the Optionee to exercise the Option shall be cancelled if and to
the
extent that shares covered by the Option are used to calculate shares
or
cash received upon exercise of any Stock Appreciation Right.
"Fair
market value" shall mean the average of the highest price and the
lowest
price at which Stock shall have been sold regular way on the New
York
Stock Exchange on the date as of which such computation is to be
made or,
if no such sales shall have been made on such day, on the next preceding
day on which there were such sales of Stock on such Exchange.
If
any fractional share of Stock would otherwise be deliverable to the
Optionee upon exercise of any Stock Appreciation Right, the Optionee
shall
be paid a cash amount equal to the same fraction of the fair market
value
of the Stock on the date of exercise.
Any
Stock Appreciation Right shall become and remain exercisable by the
Optionee only to the extent that the Option becomes and remains
exercisable.
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3.
|
Except
as provided in the two paragraphs next following, if, prior to the
date
one year from the date of the Agreement, the Optionee's employment
with
the Company shall be terminated by the Company, with or without cause,
or
by the act, death, incapacity or retirement of the Optionee, the
Optionee's right to exercise the Option and any Stock Appreciation
Right
shall terminate on the date of such termination of employment and
all
rights hereunder and under the Agreement shall cease.
Notwithstanding
the provisions of the next preceding paragraph, if the Optionee's
employment with the Company shall be terminated by reason of retirement,
release because of disability or death, and the Optionee had remained
in
the employ of the Company for at least six months following the date
of
the Agreement, and subject to the provisions of Article 3 hereof,
all the
Optionee's rights hereunder and under the Agreement shall continue
in
effect or continue to accrue until the date ten years after the date
of
the Agreement, subject, in the event of the Optionee's death during
such
ten year period, to the provisions of the sixth paragraph of this
Article
and subject to any other limitation contained herein or in the Agreement
on the exercise of the Option or any Stock Appreciation Right in
effect at
the date of exercise.
Notwithstanding
anything to the contrary set forth herein or in the Agreement, if
the
Optionee's employment with the Company shall be terminated at any
time by
reason of a sale or other disposition (including, without limitation,
a
transfer to a "Joint Venture" (as hereinafter defined)) of the division,
operation or subsidiary in which the Optionee was employed or to
which the
Optionee was assigned, all the Optionee's rights under the Option
and any
Stock Appreciation Right shall become immediately exerciseable and
continue in effect until the date five years after the date of such
termination (but not later than the date ten years from the date
of grant
of the Option), provided the Optionee shall satisfy both of the following
conditions:
(a)
the Optionee, at the date of such termination, had remained in the
employ
of the Company for at least three months following the grant of the
Option
and any Stock Appreciation Right, and
(b)
the Optionee continues to be or becomes employed in such division,
operation or subsidiary following such sale or other disposition
and
remains in such employ until the date of exercise of the Option or
any
Stock Appreciation Right (unless the Committee, or any committee
appointed
by it for the purpose, shall waive this condition (b)).
Upon
termination of the Optionee's employment with such (former) division,
operation or subsidiary following such sale or other disposition,
any then
existing right of the Optionee to exercise the Option or any Stock
Appreciation Right shall be subject to the following limitations:
(i) if
the Optionee's employment is terminated by reason of disability,
death or
retirement with the approval of his or her employer, the Optionee's
rights
shall continue as provided in the preceding sentence with the same
effect
as if his or her employment had not terminated; (ii) if the Optionee's
employment is terminated by reason of discharge or voluntary quit,
the
Optionee's rights shall terminate on the date of such termination
of
employment and all rights under the Option and any Stock Appreciation
Right shall cease; and (iii) if the Optionee's employment is terminated
for any reason other than a reason set forth in the preceding clauses
(i)
and (ii), the Optionee shall have the right, within three months
after
such termination, to exercise the Option to the extent that it or
any
installment thereof shall have accrued at the date of such termination
and
shall not have been exercised, subject in the case of any such termination
to the provisions of Article 4 hereof and any other limitation on
the
exercise of the Option or any Stock Appreciation Right in effect
at the
date of exercise. For purposes of this paragraph, the term "Joint
Venture"
shall mean any joint venture corporation or partnership, or comparable
entity, in which the Company has a substantial equity
interest.
If,
on or after the date one year from the date of the Agreement, the
Optionee's employment with the Company shall be terminated for any
reason
except retirement, release because of disability, death, release
because
of a sale or other disposition of the division, operation or subsidiary in
which the Optionee was employed or to which the Optionee was assigned,
discharge, release in the best interest of the Company or voluntary
quit,
the Optionee shall have the right, within three months after such
termination, to exercise the Option or any Stock Appreciation Right
to the
extent that it or any installment thereof shall have accrued at the
date
of such termination of employment and shall not have been exercised,
subject to the provisions of Article 4
hereof
and any other limitation contained herein or in the Agreement on
the
exercise of the Option or any Stock Appreciation Right in effect
at the
date of exercise.
If
the Optionee's employment with the Company shall be terminated at
any time
by reason of discharge, release in the best interest of the Company
or
voluntary quit, the Optionee's right to exercise the Option or any
Stock
Appreciation Right shall terminate on the date of such termination
of
employment and all rights hereunder and under the Agreement shall
cease.
If
the Optionee shall die within the applicable period specified in
the
second, third or fourth paragraph of this Article, the beneficiary
designated pursuant to Article 7 hereof or, if no such designation
is in
effect, the executor or administrator of the estate of the decedent
or the
person or persons to whom the Option or any Stock Appreciation Right
shall
have been validly transferred by the executor or the administrator
pursuant to will or the laws of descent and distribution shall have
the
right, within the same period of time as the period during which
the
Optionee would have been entitled to exercise the Option or any Stock
Appreciation Right if the Optionee had not died, to exercise the
Option or
any Stock Appreciation Right (except that, if the fourth paragraph
of this
Article shall apply to the Optionee, the Option may be exercised
only to
the extent that it or any installment thereof shall have accrued
at the
date of death and shall not have been exercised, and except that
the
period of time within which the Option shall be exercisable following
the
date of the Optionee's death shall not be less than one year (unless
the
Option by its terms expires earlier)), subject to the provision that
neither the Option nor any Stock Appreciation Right shall be exercised
under any circumstances beyond ten years from the date of the Agreement
and to any other limitation on the exercise of the Option or any
Stock
Appreciation Right in effect at the date of exercise.
Notwithstanding
anything to the contrary set forth in the Agreement or in these terms
and
conditions, neither the Option nor any Stock Appreciation Right shall
be
exercised on or after the date ten years from the date of the
Agreement.
|
4.
|
Anything
contained herein or in the Agreement to the contrary notwithstanding,
the
right of the Optionee to exercise the Option or any Stock Appreciation
Right following termination of the Optionee's employment with the
Company
shall remain effective only if, during the entire period from the
date of
the Optionee's termination to the date of such exercise, the Optionee
shall have earned out such right by (i) making himself or herself
available, upon request, at reasonable times and upon a reasonable
basis,
to consult with, supply information to and otherwise cooperate with
the
Company or any subsidiary thereof with respect to any matter that
shall
have been handled by him or her or under his or her supervision while
he
or she was in the employ of the Company or of any subsidiary thereof,
and
(ii) refraining from engaging in any activity that is directly or
indirectly in competition with any activity of the Company or any
subsidiary thereof.
In
the event of the Optionee's nonfulfillment of the condition set forth
in
the immediately preceding paragraph, the Optionee's right to exercise
the
Option or any Stock Appreciation Right shall cease; provided, however,
that the nonfulfillment of such condition may at any time (whether
before,
at the time of or subsequent to termination of his or her employment)
be
waived in the following manner:
(1)
if the Optionee at any time shall have been subject to the reporting
requirements of Section 16(a) of the Securities Exchange Act of 1934,
as
amended (the "Exchange Act") or the liability provisions of Section
16(b)
of the Exchange Act (any such Optionee being hereinafter called a
"Section
16 Person"), such waiver may be granted by the Committee upon its
determination that in its sole judgment there shall not have been
and will
not be any substantial adverse effect upon the Company or any subsidiary
thereof by reason of the nonfulfillment of such condition;
and
(2)
if the Optionee shall not at any time have been a Section 16 Person,
such
waiver may be granted by the Committee (or any committee appointed
by it
for the purpose) upon its determination that in its sole judgment
there
shall not have been and will not be any such substantial adverse
effect.
Anything
contained herein or in the Agreement to the contrary notwithstanding,
the
right of the Optionee to exercise the Option or any Stock Appreciation
Right following termination of the Optionee's employment with the
Company
shall cease on and as of the date on which it has been determined
by the
Committee that the Optionee at any time (whether before or subsequent
to
termination of the Optionee's employment) acted in a manner inimical
to
the best interests of the Company. Conduct which constitutes engaging
in
an activity that is directly or indirectly in competition with any
activity of the Company
or
any subsidiary thereof shall be governed by the four immediately
preceding
paragraphs of this Article and shall not be subject to any determination
under this paragraph.
|
5.
|
Payment
for any shares of Stock purchased upon exercise of the Option shall
be
made in full at the time of exercise. Such payment may be made in
cash, by
wire, by delivery of shares of Stock beneficially owned by the Optionee
or
by a combination of cash and Stock, at the election of the Optionee;
provided, however, that any shares of Stock so delivered shall have
been
beneficially owned by the Optionee for a period of not less than
six
months prior to the date of such exercise. Any shares of Stock so
delivered shall be valued at their fair market value on the date
of such
exercise.
The
Optionee, from time to time during the period when the Option and
any
Stock Appreciation Right may by its terms be exercised, (a) may exercise
the Option in whole or in part by delivering to the Company or its
designee: (i) a written notice signed by the Optionee stating the
number
of shares that the Optionee has elected to purchase at that time
from the
Company, and (ii) a check or wire transfer in an amount, or (in accordance
with the two preceding paragraphs) shares of Stock having a value,
equal
to the purchase price of the shares then to be purchased, or a combination
of shares of Stock and cash, or (b) may exercise any Stock Appreciation
Right in whole or in part by delivering to the Company a written
notice
signed by the Optionee stating (i) the number of shares covered by
the
Option he or she has elected to use to compute the number of shares,
and/or (ii) the number of shares covered by the Option he or she
has
elected to use to compute the amount of cash, to be received from
the
Company pursuant to exercise of any Stock Appreciation Right. The
Committee, if it shall deem it necessary or desirable for any reason
connected with any law or regulation of any governmental authority
relating to the regulation of securities, may require the Optionee
to
execute and file with it such evidence as it may deem necessary that
the
Optionee is acquiring any shares of Stock for investment and not
with a
view to their distribution and, by way of the adoption of rules and
regulations or otherwise, impose conditions as to the time and manner
of
exercise of any Stock Appreciation Right by any person or class or
persons.
As
soon as practicable after receipt by the Company or its designee
of such
notice, check or wire transfer and/or shares of Stock (if the Option
is
exercised in whole or in part) and such evidence of intent to acquire
for
investment as may be required by the Committee, the Company shall
issue
the appropriate number of shares in the name of the Optionee and
deliver
the certificate therefor to the Optionee. The number of shares shall
be
adjusted appropriately, or other appropriate arrangements shall be
made,
for any taxes required to be withheld by federal, state or local
law.
|
6.
|
As
a condition of the granting of the Option, the Optionee and the Optionee's
successors and assigns agree that any dispute or disagreement which
shall
arise under or as a result of the Agreement or these terms and conditions
shall be determined by the Committee in its sole discretion and judgment
and that any such determination and any interpretation by the Committee
of
the Agreement or of these terms and conditions shall be final and
shall be
binding and conclusive for all purposes.
|
7.
|
Unless
the Committee determines otherwise neither the Option nor any Stock
Appreciation Right is transferable by the Optionee otherwise than
by will
or the laws of descent and distribution, and, during the Optionee's
lifetime, is exercisable only by the Optionee or the Optionee's guardian
or legal representative. Once transferred by will or by the laws
of
descent and distribution, neither the Option nor any Stock Appreciation
Right shall be further transferable. Any transferee of the Option
and any
Stock Appreciation Right shall take the same subject to the terms
and
conditions set forth herein. No such transfer of the Option shall
be
effective to bind the Company unless the Company shall have been
furnished
with written notice thereof and a copy of the will and/or such other
evidence as the Committee may deem necessary to establish the validity
of
the transfer and the acceptance by the transferee or transferees
of the
terms and conditions set forth herein. No assignment or transfer
of the
Option and any Stock Appreciation Right, or of the rights represented
thereby, other than as provided in this Article, shall vest in the
purported assignee or transferee any interest or right therein
whatsoever.
Notwithstanding
anything to the contrary set forth herein, the Optionee may file
with the
Company or its designee a written designation of beneficiary or
beneficiaries (subject to such limitations as to the classes and
number of
beneficiaries and contingent beneficiaries and such other limitations
as
the Committee from time to time may prescribe) to exercise, in the
event
of the Optionee's death, the Option or any Stock Appreciation Right
subject to the terms and conditions set forth herein and to receipt
by the
Company of such evidence as the Committee may deem necessary to establish
the acceptance by the beneficiary or beneficiaries of the terms and
conditions set forth herein. The Optionee shall be deemed to have
designated as beneficiary or beneficiaries the person or persons
who
receive the Optionee's life insurance proceeds under the basic Company
Life Insurance Plan unless the Optionee shall have assigned such
life
insurance or shall have filed with the Company a written designation
of a
different beneficiary or beneficiaries. The Optionee may from time
to time
revoke or change any such designation of beneficiary and any designation
of beneficiary by the Optionee shall be controlling over any other
disposition, testamentary or otherwise; provided, however, that if
the
Committee shall be in doubt as to the entitlement of any such beneficiary
to exercise the Option or any Stock Appreciation Right, the Committee
may
determine to recognize only an exercise by the legal representative
of the
Optionee, in which case the Company, the Committee and the members
thereof
shall not be under any further liability to anyone.
|
8.
|
The
Optionee, a beneficiary designated pursuant to Article 7 hereof or
a
transferee of the Option or any Stock Appreciation Right shall have
no
rights as a stockholder with respect to any share covered by the
Option or
any Stock Appreciation Right until such person shall have become
the
holder of record of such share, and, except as provided in Article
10
hereof, no adjustment shall be made for dividends (ordinary or
extraordinary, whether in cash or securities or other property) or
distributions or other rights in respect of such share for which
the
record date is prior to the date upon which such person shall become
the
holder of record thereof.
|
9.
|
The
existence of the Option or any Stock Appreciation Right shall not
affect
in any way the right or power of the Company or its stockholders
to make
or authorize any adjustments, recapitalizations, reorganizations
or other
changes in the Company's capital structure or its business, or any
merger
or consolidation of the Company, or any issue of bonds, debentures,
preferred or prior preference stocks ahead of or affecting the Stock
or
the rights thereof, or the dissolution or liquidation of the Company,
or
any sale or transfer of all or any part of its assets or business,
or any
other corporate act or proceedings whether of a similar character
or
otherwise.
|
10.
|
The
shares covered by the Option and any Stock Appreciation Right are
shares
of Stock as presently constituted, but if, and whenever, prior to
the
delivery by the Company of all of the shares of Stock deliverable
upon
exercise of the Option or any Stock Appreciation Right, the Company
shall
effect the payment of a stock dividend on Stock payable in shares
of
Stock, a subdivision or combination of the shares of Stock, or a
reclassification of Stock, the number and price of shares remaining
under
the Option or any Stock Appreciation Right shall be appropriately
adjusted. Such adjustment shall be made by the Committee, whose
determination as to what adjustment shall be made, and the extent
thereof,
shall be final and shall be binding and conclusive for all purposes.
Any
such adjustment may provide for the elimination of any fractional
share
which might otherwise become subject to the Option.
|
11.
|
Except
as hereinbefore expressly provided, (a) the issue by the Company
of shares
of Stock of any class, or securities convertible into shares of Stock
of
any class, for cash or property or for labor or services, either
upon
direct sale or upon the exercise of rights or warrants to subscribe
therefor, or upon conversion of shares or obligations of the Company
convertible into such shares or other securities, or (b) the payment
of a
stock dividend on any other class of the Company's stock, or (c)
any
subdivision or combination of the shares of any other class of the
Company's stock, or (d) any reclassification of any other class of
the
Company's stock, shall not affect, and no adjustment by reason thereof
shall be made with respect to, the number or price of shares of Stock
subject to the Option or any Stock Appreciation Right.
|
12.
|
After
any merger of one or more corporations into the Company, or after
any
consolidation of the Company and one or more corporations in which
the
Company shall be the surviving corporation, the Optionee shall, at
no
additional cost, be entitled upon any exercise of the Option or any
Stock
Appreciation Right to receive (subject to any required action by
stockholders), in lieu of the number of shares as to which the Option
or
any Stock Appreciation Right shall then be so exercised, the number
and
class of shares of stock or other securities to which the Optionee
would
have been entitled pursuant to the terms of the agreement of merger
or
consolidation if at the time of such merger or consolidation the
Optionee
had been a holder of record of a number of shares of Stock equal
to the
number of shares as to which such Option or any Stock Appreciation
Right
shall then be so exercised. Comparable rights shall accrue to the
Optionee
in the event of successive mergers or consolidations of the character
described above or in the event of any exercise of any Stock Appreciation
Right for cash following any such merger or consolidation. Anything
contained herein or in the Agreement to the contrary notwithstanding,
upon
the dissolution or liquidation of the Company, or upon any merger
or
consolidation in which the Company is not the surviving corporation,
the
Option and any Stock Appreciation Right shall terminate; but if a
period
of one year from the date of the Agreement shall have expired, the
Optionee shall have the right, immediately prior to such dissolution,
liquidation, merger or consolidation, to exercise the Option or any
Stock
Appreciation Right in whole or in part to the extent it shall not
have
been exercised, without regard to the installment provisions of Article
1
hereof but subject to any other limitation contained herein or in
the
Agreement on the exercise of the Option and any Stock Appreciation
Right
in effect on the date of exercise. In the event of any other event
affecting Stock, an appropriate adjustment shall be made in the number
and
price of shares remaining under, and other terms and provisions of,
the
Option and any Stock Appreciation Right. The foregoing adjustments
and the
manner of application of the foregoing provisions shall be determined
by
the Committee in its sole discretion, and such determination shall
be
final and d shall be binding and conclusive for all purposes. Any
such
adjustment may provide for the elimination of any fractional share
which
might otherwise become subject to the Option.
|
13.
|
Optionee
acknowledges and agrees that, in order for the Company to perform
its
requirements under the Plan, the Company may process, for an indefinite
period of time, personal data about Optionee. Such data includes,
but is
not limited to, the information provided in the Option grant materials
and
any changes thereto, and other appropriate personal data about Optionee,
including information about Optionee's participation in the Plan
and
options exercised under the Plan from time to time. Optionee also
hereby
gives for an indefinite period of time Optionee's explicit consent
to the
Company to collect, use, store and transfer any such personal data
for use
in the United States of America or any other required location. The
legal
persons for whom the personal data is intended include Ford and any
of its
subsidiaries, the outside plan administrator as selected by the Company
from time to time and an other person that the Company may deem
appropriate in its administration of the Plan. Optionee has been
informed
of Optionee's right to access and correct Optionee's personal data
by
contacting Optionee's local Human Resources Representative. Optionee
has
been informed of Optionee's right to withdraw at any time Optionee's
consent to the processing of personal data. Optionee has been informed
that the provision of personal data is voluntary. Optionee understands
that the transfer of the information outlined here is important to
the
administration of the Plan. Optionee's consent is given freely and
is
valid as long as it is needed for administration of the Plan or to
comply
with applicable legal requirements. Optionee's failure to consent
to the
Company's collection, use, storage and transfer of such personal
data may
limit Optionee's right to participate in the Plan. For purposes of
this
paragraph, the term "Company" shall be deemed to include Ford Motor
Company, Optionee's employer, and any other affiliate of Ford Motor
Company involved in the administration of the Plan.
|
14.
|
Optionee
acknowledges that the Company is entitled to terminate the Plan
unilaterally, and Optionee hereby waives any right to receive Plan
benefits in the event that the Plan is terminated or Optionee's right
to
exercise the Option otherwise terminates under the terms of the Agreement.
Optionee further acknowledges that the Company's grant of the option
to
Optionee is not an element of the Optionee's compensation and that
the
option is awarded in the Company's discretion. Optionee further
acknowledges that receipt of the Option does not entitle Optionee
to any
further grants of an Option in the future, and that the Company does
not
guarantee that benefits under the Plan will have a particular value
or be
granted to Optionee in the future.
|
15.
|
Notwithstanding
any of the other provisions of the Agreement or these terms and
conditions, the Optionee agrees not to exercise the Option or any
Stock
Appreciation Right, and that the Company will not be obligated to
issue
any shares pursuant to the Agreement, if the exercise of the Option
or any
Stock Appreciation Right or the issuance of such shares would constitute
a
violation by the Optionee or by the Company of any provisions of
any law
or regulation of any governmental authority. Any determination of
the
Committee in this connection shall be final and shall be binding
and
conclusive for all purposes. The Company shall in no event be obligated
to
take any affirmative action in order to cause the exercise of the
Option
or any Stock Appreciation Right or the issuance of shares pursuant
thereto
to comply with any law or any regulation of any governmental
authority.
|
16.
|
Every
notice relating to the Agreement shall be in writing and shall be
given by
registered mail with return receipt requested. All notices to the
Company
shall be addressed to:
Smith
Barney, Inc.,
Ford
Service Center,
1001
Page Mill Road,
Bldg.
4, Suite 101
Palo
Alto, CA 94304, USA
Phone
No: 877-664-FORD (3673) (U.S.); 212-615-7009 (Non U.S.)
Fax
No.: 650-494-2561
All
notices by the Company to the Optionee shall be addressed to the
current
address of the Optionee as shown on the records of the Company. Either
party by notice to the other may designate a different address to
which
notices shall be addressed. Any notice given by the Company to the
Optionee at his or her last designated address shall be effective
to bind
any other person who shall acquire rights under the
Agreement.
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17.
|
Whenever
the term "Optionee" is used in any provision of the Agreement or
these
terms and conditions under circumstances such that the provision
should
logically apply to any other person or persons designated as a beneficiary
pursuant to the provisions of Article 7 hereof, or to whom the Option
and
any Stock Appreciation Right, in accordance with the provisions of
Article
7 hereof, may be transferred, the term "Optionee" shall be deemed
to
include such person or persons.
|
18.
|
The
Agreement has been made in and it and these terms and conditions
shall be
construed in accordance with the laws of the State of
Michigan.
|
AUTHENTICATED
as
of the above date
By_________________________________
Executive
Compensation Human Resources
|
FORD
MOTOR COMPANY
By
____________________________
Executive
Vice President and Chief Financial Officer
Optionee:
«First_MI»
«Last_name»
_
Optionee
ID: ____________________
By
____________________________
Manager
Compensation Programs
|
1.
|
The
Option may not be exercised prior to the date one year from the date
of
the Stock Option Agreement of which these terms and conditions are
a part
(the "Agreement"). Thereafter, the Option may be exercised in installments
as follows:
(a)
Beginning on the date one year from the date of the Agreement, the
Option
may be exercised to the extent of 33% of the shares originally covered
thereby;
(b)
Beginning on the date two years from the date of the Agreement, the
Option
may be exercised to the extent of an additional 33% of the shares
originally covered thereby;
(c)
Beginning on the date three years from the date of the Agreement,
the
Option may be exercised to the extent of an additional 34% of the
shares
originally covered thereby;
(d)
To the extent not exercised installments shall be cumulative and
may be
exercised in whole or in part; and
all
subject to the Agreement and these terms and conditions and any rules
and
regulations established by the Committee pursuant to the Plan or
the
United Kingdom Rules.
Notwithstanding
the foregoing, if your stock option grant included an incentive stock
option (ISO), the ISO portion of the grant would be maximized within
permissible regulatory limits. This could result in a different number
of
options vesting on the first three anniversary dates of the grant
under
the nonqualified option (NQO) and/or the ISO portion of the grant
than the
number indicated by the schedule above. In any event, the total number
of
NQOs and ISOs in the grant, will, as a hole, vest according to the
schedule above. Your account statement (available online through
a Smith
Barney phone representative and mailed to you annually) will reflect
the
specific number of ISOs and NQOs vesting on the specific
dates.
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2.
|
Except
as provided in the two paragraphs next following, if, prior to the
date
one year from the date of the Agreement, the Optionee's employment
with
the Company shall be terminated by the Company, with or without cause,
or
by the act, death, incapacity or retirement of the Optionee, the
Optionee's right to exercise the Option shall terminate on the date
of
such termination of employment and all rights hereunder and under
the
Agreement shall cease.
Notwithstanding
the provisions of the next preceding paragraph, if the Optionee's
employment with the Company shall be terminated by reason of retirement,
release because of disability or death, and the Optionee had remained
in
the employ of the Company for at least six months following the date
of
the Agreement, and subject to the provisions of Article 3 hereof,
all the
Optionee's rights hereunder and under the Agreement shall continue
in
effect or continue to accrue until the date ten years after the date
of
the Agreement, subject, in the event of the Optionee's death during
such
ten year period, to the provisions of the sixth paragraph of this
Article
and subject to any other limitation contained herein or in the Agreement
on the exercise of the Option in effect at the date of
exercise.
Notwithstanding
anything to the contrary set forth herein or in the Agreement, if
the
Optionee's employment with the Company shall be terminated at any
time by
reason of a sale or other disposition (including, without limitation,
a
transfer to a "Joint Venture" (as hereinafter defined)) of the division,
operation or subsidiary in which the Optionee was employed or to
which the
Optionee was assigned, all the Optionee's rights under the Option
shall
become immediately exercisable and continue in effect until the date
five
years after the date of such termination (but not later than the
date ten
years from the date of grant of the Option), provided the Optionee
shall
satisfy both of the following conditions:
(a)
the Optionee, at the date of such termination, had remained in the
employ
of the Company for at least three months following the grant of the
Option, and
(b)
the Optionee continues to be or becomes employed in such division,
operation or subsidiary following such sale or other disposition
and
remains in such employ until the date of exercise of the Option (unless
the Committee, or any committee appointed by it for the purpose,
shall
waive this condition (b)).
Upon
termination of the Optionee's employment with such (former) division,
operation or subsidiary following such sale or other disposition,
any then
existing right of the Optionee to exercise the Option shall be subject
to
the following limitations: (i) if the Optionee's employment is terminated
by reason of disability, death or retirement with the approval of
his or
her employer, the Optionee's rights shall continue as provided in
the
preceding sentence with the same effect as if his or her employment
had
not terminated; (ii) if the Optionee's employment is terminated by
reason
of discharge or voluntary quit, the Optionee's rights shall terminate
on
the date of such termination of employment and all rights under the
Option
shall cease; and (iii) if the Optionee's employment is terminated
for any
reason other than a reason set forth in the preceding clauses (i)
and
(ii), the Optionee shall have the right, within three months after
such
termination, to exercise the Option to the extent that it or any
installment thereof shall have accrued at the date of such termination
and
shall not have been exercised, subject in the case of any such termination
to the provisions of Article 3 hereof and any other limitation on
the
exercise of the Option in effect at the date of exercise. For purposes
of
this paragraph, the term "Joint Venture" shall mean any joint venture
corporation or partnership, or comparable entity, in which the Company
has
a substantial equity interest.
If,
on or after the date one year from the date of the Agreement, the
Optionee's employment with the Company shall be terminated for any
reason
except retirement, release because of disability, death, release
because
of a sale or other disposition of the division, operation or subsidiary
in
which the Optionee was employed or to which the Optionee was assigned,
discharge, release in the best interest of the Company or voluntary
quit,
the Optionee shall have the right, within three months after such
termination, to exercise the Option to the extent that it or any
installment thereof shall have accrued at the date of such termination
of
employment and shall not have been exercised, subject to the provisions
of
Article 3 hereof and any other limitation contained herein or in
the
Agreement on the exercise of the Option in effect at the date of
exercise.
If
the Optionee's employment with the Company shall be terminated at
any time
by reason of discharge, release in the best interest of the Company
or
voluntary quit, the Optionee's right to exercise the Option shall
terminate on the date of such termination of employment and all rights
hereunder and under the Agreement shall cease.
If
the Optionee shall die within the applicable period specified in
the
second, third or fourth paragraph of this Article, the beneficiary
designated pursuant to Article 6 hereof or, if no such designation
is in
effect, the executor or administrator of the estate of the decedent
or the
person or persons to whom the Option shall have been validly transferred
by the executor or the administrator pursuant to will or the laws
of
descent and distribution shall have the right, within the same period
of
time as the period during which the Optionee would have been entitled
to
exercise the Option if the Optionee had not died, to exercise the
Option
(except that, if the fourth paragraph of this Article shall apply
to the
Optionee, the Option may be exercised only to the extent that it
or any
installment thereof shall have accrued at the date of death and shall
not
have been exercised, and except that the period of time within which
the
Option shall be exercisable following the date of the Optionee's
death
shall not be more than one year or less than one year (unless the
Option
by its terms expires earlier)), subject to the provision that the
Option
shall not be exercised under any circumstances beyond ten years from
the
date of the Agreement and to any other limitation on the exercise
of the
Option in effect at the date of exercise.
Notwithstanding
anything to the contrary set forth in the Agreement or in these terms
and
conditions, the Option shall not be exercised on or after the date
ten
years from the date of the Agreement.
|
3.
|
Anything
contained herein or in the Agreement to the contrary notwithstanding,
the
right of the Optionee to exercise the Option following termination
of the
Optionee's employment with the Company shall remain effective only
if,
during the entire period from the date of the Optionee's termination
to
the date of such exercise, the Optionee shall have earned out such
right
by (i) making himself or herself available, upon request, at reasonable
times and upon a reasonable basis, to consult with, supply information
to
and otherwise cooperate with the Company or any subsidiary thereof
with
respect to any matter that shall have been handled by him or her
or under
his or her supervision while he or she was in the employ of the Company
or
of any subsidiary thereof, and (ii) refraining from engaging in any
activity that is directly or indirectly in competition with any activity
of the Company or any subsidiary thereof.
In
the event of the Optionee's nonfulfillment of the condition set forth
in
the immediately preceding paragraph, the Optionee's right to exercise
the
Option shall cease; provided, however, that the nonfulfillment of
such
condition may at any time (whether before, at the time of or subsequent
to
termination of his or her employment) be waived in the following
manner:
(1)
if the Optionee at any time shall have been subject to the reporting
requirements of Section 16(a) of the Securities Exchange Act of 1934,
as
amended (the "Exchange Act") or the liability provisions of Section
16(b)
of the Exchange Act (any such Optionee being hereinafter called a
"Section
16 Person"), such waiver may be granted by the Committee upon its
determination that in its sole judgment there shall not have been
and will
not be any substantial adverse effect upon the Company or any subsidiary
thereof by reason of the nonfulfillment of such condition;
and
(2)
if the Optionee shall not at any time have been a Section 16 Person,
such
waiver may be granted by the Committee (or any committee appointed
by it
for the purpose) upon its determination that in its sole judgment
there
shall not have been and will not be any such substantial adverse
effect.
Anything
contained herein or in the Agreement to the contrary notwithstanding,
the
right of the Optionee to exercise the Option following termination
of the
Optionee's employment with the Company shall cease on and as of the
date
on which it has been determined by the Committee that the Optionee
at any
time (whether before or subsequent to termination of the Optionee's
employment) acted in a manner inimical to the best interests of the
Company. Conduct which constitutes engaging in an activity that is
directly or indirectly in competition with any activity of the Company
or
any subsidiary thereof shall be governed by the four immediately
preceding
paragraphs of this Article and shall not be subject to any determination
under this paragraph.
|
4.
|
Payment
for any shares of Stock purchased upon exercise of the Option shall
be
made in full at the time of exercise. Such payment must be made in
cash.
The
Optionee, from time to time during the period when the Option may
by its
terms be exercised, may exercise the Option in whole or in part by
delivering to the Company: (i) a written notice signed by the Optionee
stating the number of shares that the Optionee has elected to purchase
at
that time from the Company, and (ii) a check in an amount equal to
the
purchase price of the shares then to be purchased. The Committee,
if it
shall deem it necessary or desirable for any reason connected with
any law
or regulation of any governmental authority relating to the regulation
of
securities, may require the Optionee to execute and file with it
such
evidence as it may deem necessary that the Optionee is acquiring
any
shares of Stock for investment and not with a view to their
distribution.
As
soon as practicable after receipt by the Company of such notice and
check
(if the Option is exercised in whole or in part) and such evidence
of
intent to acquire for investment as may be required by the Committee,
the
Company shall issue the appropriate number of shares in the name
of the
Optionee and deliver the certificate therefor to the Optionee. The
number
of shares shall be adjusted appropriately, or other appropriate
arrangements shall be made, for any taxes required to be withheld
by
United Kingdom or United States federal, state or local law.
|
5.
|
As
a condition of the granting of the Option, the Optionee and the Optionee's
successors and assigns agree that any dispute or disagreement which
shall
arise under or as a result of the Agreement or these terms and conditions
shall be determined by the Committee in its sole discretion and judgment
and that any such determination and any interpretation by the Committee
of
the Agreement or of these terms and conditions shall be final and
shall be
binding and conclusive for all purposes.
|
6.
|
The
option is not transferable by the Optionee and, during the Optionee's
lifetime, the Option is exercisable only by the Optionee or the Optionee's
legal representative.
|
7.
|
The
Optionee, or the Optionee's legal representative shall have no rights
as a
stockholder with respect to any share covered by the Option until
such
person shall have become the holder of record of such share, and,
except
as provided in Article 9 hereof, no adjustment shall be made for
dividends
(ordinary or extraordinary, whether in cash or securities or other
property) or
distributions
or other rights in respect of such share for which the record date
is
prior to the date upon which such person shall become the holder
of record
thereof.
|
8.
|
The
existence of the Option shall not affect in any way the right or
power of
the Company or its stockholders to make or authorize any adjustments,
recapitalizations, reorganizations or other changes in the Company's
capital structure or its business, or any merger or consolidation
of the
Company, or any issue of bonds, debentures, preferred or prior preference
stocks ahead of or affecting the Stock or the rights thereof, or
the
dissolution or liquidation of the Company, or any sale or transfer
of all
or any part of its assets or business, or any other corporate act
or
proceedings whether of a similar character or otherwise.
|
9.
|
The
shares covered by the Option are shares of Stock as presently constituted,
but if, and whenever, prior to the delivery by the Company of all
of the
shares of Stock deliverable upon exercise of the Option, the Company
shall
effect the payment of a stock dividend on Stock payable in shares
of
Stock, a subdivision or combination of the shares of Stock, or a
reclassification of Stock, the number and price of shares remaining
under
the Option shall be appropriately adjusted, provided that the adjustment
is permitted by paragraph 29, Schedule 9 t the Income and Corporation
Taxes Act 1988 and also provided that the adjustment will not be
effective
until and unless it is approved by the Board of the Inland Revenue.
Such
adjustment shall be made by the Committee, whose determination as
to what
adjustment shall be made, and the extent thereof, shall be final
and shall
be binding and conclusive for all purposes. Any such adjustment may
provide for the elimination of any fractional share which might otherwise
become subject to the Option.
|
10.
|
Except
as hereinbefore expressly provided, (a) the issue by the Company
of shares
of Stock of any class, or securities convertible into shares of Stock
of
any class, for cash or property or for labor or services, either
upon
direct sale or upon the exercise of rights or warrants to subscribe
therefor, or upon conversion of shares or obligations of the Company
convertible into such shares or other securities, or (b) the payment
of a
stock dividend on any other class of the Company's stock, or (c)
any
subdivision or combination of the shares of any other class of the
Company's stock, or (d) any reclassification of any other class of
the
Company's stock, shall not affect, and no adjustment by reason thereof
shall be made with respect to, the number or price of shares of Stock
subject to the Option.
|
11.
|
Subject
to Rule 6 of the United Kingdom Rules, after any merger of one or
more
corporations into the Company, or after any consolidation of the
Company
and one or more corporations in which the Company shall be the surviving
corporation, the Optionee shall, at no additional cost, be entitled
upon
any exercise of the Option, to receive (subject to any required action
by
stockholders), in lieu of the number of shares as to which the Option
shall then be so exercised, the number and class of shares of Stock
or
other securities to which the Optionee would have been entitled pursuant
to the terms of the agreement of merger or consolidation if at the
time of
such merger or consolidation the Optionee had been a holder of record
of a
number of shares of Stock equal to the number of shares as to which
such
Option shall then be so exercised. Comparable rights shall accrue
to the
Optionee in the event of successive mergers or consolidations of
the
character described above. Anything contained herein or in the Agreement
to the contrary notwithstanding, upon the dissolution or liquidation
of
the Company, or upon any merger or consolidation in which the Company
is
not the surviving corporation, the Option shall terminate; but if
a period
of one year from the date of the Agreement shall have expired, the
Optionee shall have the right, immediately prior to such dissolution,
liquidation, merger or consolidation, to exercise the Option in whole
or
in part to the extent it shall not have been exercised, without regard
to
the installment provisions of Article 1 hereof but subject to any
other
limitation contained herein or in the Agreement on the exercise of
the
Option in effect on the date of exercise. In the event of any other
event
affecting Stock, an appropriate adjustment shall be made in the number
and
price of shares remaining under, and other terms and provisions of,
the
Option. The foregoing adjustments and the manner of application of
the
foregoing provisions shall be determined by the Committee in its
sole
discretion, and such determination shall be final and shall be binding
and
conclusive for all purposes. Any such adjustment may provide for
the
elimination of any fractional share which might otherwise become
subject
to the Option.
|
12.
|
Optionee
acknowledges and agrees that, in order for the Company to perform
its
requirements under the Plan, the Company may process, for an indefinite
period of time, personal data about Optionee. Such data includes,
but is
not limited to, the information provided in the Option grant materials
and
any changes thereto, and other appropriate personal data about Optionee,
including information about Optionee's participation in the Plan
and
options exercised under the Plan from time to time. Optionee also
hereby
gives for an indefinite period of time Optionee's explicit consent
to the
Company to collect, use, store and transfer any such personal data
for use
in the United States of America or any other required location. The
legal
persons for whom the personal data is intended include Ford and any
of its
subsidiaries, the outside plan administrator as selected by the Company
from time to time and an other person that the Company may deem
appropriate in its administration of the Plan. Optionee has been
informed
of Optionee's right to access and correct Optionee's personal data
by
contacting Optionee's local Human Resources Representative. Optionee
has
been informed of Optionee's right to withdraw at any time Optionee's
consent to the processing of personal data. Optionee has been informed
that the provision of personal data is voluntary. Optionee understands
that the transfer of the information outlined here is important to
the
administration of the Plan. Optionee's consent is given freely and
is
valid as long as it is needed for administration of the Plan or to
comply
with applicable legal requirements. Optionee's failure to consent
to the
Company's collection, use, storage and transfer of such personal
data may
limit Optionee's right to participate in the Plan. For purposes of
this
paragraph, the term "Company" shall be deemed to include Ford Motor
Company, Optionee's employer, and any other affiliate of Ford Motor
Company involved in the administration of the
Plan.
|
13.
|
Optionee
acknowledges that the Company is entitled to terminate the Plan
unilaterally, and Optionee hereby waives any right to receive Plan
benefits in the event that the Plan is terminated or Optionee's right
to
exercise the Option otherwise terminates under the terms of the Agreement.
Optionee further acknowledges that the Company's grant of the option
to
Optionee is not an element of the Optionee's compensation and that
the
option is awarded in the Company's discretion. Optionee further
acknowledges that receipt of the Option does not entitle Optionee
to any
further grants of an Option in the future, and that the Company does
not
guarantee that benefits under the Plan will have a particular value
or be
granted to Optionee in the future.
|
14.
|
Notwithstanding
any of the other provisions of the Agreement or these terms and
conditions, the Optionee agrees not to exercise the Option, and that
the
Company will not be obligated to issue any shares pursuant to the
Agreement, if the exercise of the Option or the issuance of such
shares
would constitute a violation by the Optionee or by the Company of
any
provisions of any law or regulation of any governmental authority.
Any
determination of the Committee in this connection shall be final
and shall
be binding and conclusive for all purposes. The Company shall in
no event
be obligated to take any affirmative action in order to cause the
exercise
of the Option or the issuance of shares pursuant thereto to comply
with
any law or any regulation of any governmental authority.
|
15.
|
Every
notice relating to the Agreement shall be in writing and shall be
given by
registered mail with return receipt requested. All notices to the
Company
shall be addressed to:
Smith
Barney, Inc.
Ford
Service Center
1001
Page Mill Road
Bldg.
4, Suite 101
Palo
Alto, CA 94304, USA
Phone
No.: 877-664-FORD (3673) (U.S.), 212-615-7009 (Non-U.S.),
Fax
No.: 650-494-2561
All
notices by the Company to the Optionee shall be addressed to the
current
address of the Optionee as shown on the records of the Company. Either
party by notice to the other may designate a different address to
which
notices shall be addressed. Any notice given by the Company to the
Optionee at his or her last designated address shall be effective
to bind
any other person who shall acquire rights under the
Agreement.
|
16.
|
The
Agreement has been made in and it and these terms and conditions
shall be
construed in accordance with the laws of the State of
Michigan.
|
17.
|
No
U.K. income tax will be payable on the grant of the Option. The Company
will, however, inform the U.K. Inland Revenue of the grant of the
Option.
No U.K. income tax will be payable on the exercise of the Option,
provided
that the scheme retains its U.K. Inland Revenue approved status
and:
(a)
the Option is exercised more than 3 years and not more than 10 years
from
the date of grant; and
(b)
it is not exercised within 3 years of the date when the Optionee
last
exercised a right obtained under any U.K. Inland Revenue approved
discretionary share option scheme (whether run by the Optionee's
present
employer or any other company whatsoever) and in respect of which
the
Optionee obtained relief from U.K. income tax. All Options exercised
on
the same day count as one exercise for this purpose.
|
· |
Stock
options
|
· |
Performance-based
RSEs
(
2006
performance period - assumes 100% objectives
achieved)
|
· |
PSRs
(
2006-2008
PSR performance period-assumes 100% target level
achieved)
|
· |
Assume
a Fair Market Value of $9.00 and a Black-Scholes value of $3.15 per
share*.
|
· |
[25,000
shares x $3.15]/$9.00 = 8,750 maximum number of RSEs that may be
awarded
in
March
2007
.
|
· |
Company
Performance
|
· |
Strategic
Direction and Operational
Effectiveness
|
· |
Leadership
|
· |
People
and Culture
|
· |
Company
Performance
|
· |
Strategic
Direction and Operational
Effectiveness
|
· |
Leadership
|
· |
People
and Culture
|
· |
[Reduction
of manufacturing capacity.]
|
· |
[Achievement
of cost reduction targets.]
|
· |
[Increased
platform and component sharing.]
|
· |
[Increased
market share.]
|
· |
[Completion
and implementation of the Visteon
transaction.]
|
Ø |
Your
total award opportunity value is: [
]
|
Ø |
Your
total award opportunity is: [ ]
|
· |
You
will retire under the terms of the Select Retirement Program, pending
your
signature on the appropriate separation waiver agreement which is
attached
for your review.
|
· |
You
will serve as a consultant to the Company, subject to the terms and
conditions of a consulting Agreement to be signed by you and the
Company,
unless the Agreement is terminated earlier. This agreement is also
attached for your review.
|
· |
It
will be requested of the Compensation Committee of the Board of Directors
that you will receive and retain your 2005 final performance-based
RSE
award. Consistent with other Officers, this award will have a one-year
restriction period during which time dividend equivalents will be
paid. It
will also be requested the Committee grant an exception to policy
and deem
that you have met the minimum holding requirements for any other
applicable stock based awards following your retirement.
|
1. |
Scope
of Services
:
Subject
to the terms and conditions contained herein, during the calendar
months
beginning on March 1, 2006 and ending November 30, 2006, unless
this Agreement is terminated earlier pursuant to Section 13 hereof,
you
will be available to provide consultation to the Company.
|
2. |
Competitive
Behavior
:
As a condition of the Company’s obligations under this Agreement, during
the term of this Agreement, you will not, without written permission
of
the Company, on behalf of yourself or on behalf of any other person,
company, corporation, partnership or other entity or enterprise,
directly
or indirectly, as an employee, proprietor, stockholder, partner,
consultant, or otherwise, engage in any business or activity competitive
with the business of Ford Motor Company, its subsidiaries or affiliates
worldwide. You specifically acknowledge that the Company conducts
a
worldwide business and that the worldwide restriction is reasonable.
You
also agree during the term of this Agreement that you will not engage
in
any conduct that is inimical to the best interests of the Company,
its
subsidiaries, or affiliates worldwide. In the event you breach these
restrictive covenants, the Company shall be entitled to the remedies
outlined in Section 3 below with respect to breach of Confidential
Information.
|
3. |
Confidential
Information and Remedies
:
You agree to keep secret and retain in strictest confidence, and
shall
not, without the prior written consent of the Chairman and Chief
Executive
Officer of
the
Company, furnish, make available or disclose to any third party
or use for
your benefit or the benefit of any third party, any Confidential
Information as hereafter defined. As used in this Agreement, Confidential
Information means any information relating to the business or affairs
of
the Company, including but not limited to, information relating
to
financial statements, customer identities, potential customers,
employees,
suppliers, servicing methods, equipment, product or service programs,
product designs, cycle plans, strategies and information, databases
and
information systems, analyses, profit margins, pricing, comparative
or
futuring studies or other proprietary information used by the Company,
whether or not generated by the Company or purchased by the Company
through business consultants. Confidential Information shall not
include
any information in the public domain or information that becomes
known in
the industry through no wrongful act on your part. You acknowledge
that
the Confidential Information is vital, sensitive, confidential
and
proprietary to the Company. You acknowledge and agree that your
promise to
keep confidential the Confidential Information is reasonable and
necessary
for the protection of the Company’s business interests; that irreparable
injury will result to the Company if you break your promise, and
that the
Company may not have an adequate remedy at law if you break or
threaten to
break your promise. Accordingly, you agree that in such event,
the Company
will be entitled to immediate temporary injunctive and other equitable
relief in a court of competent jurisdiction, without the necessity
of
showing actual monetary damages, subjective to a hearing as soon
thereafter as possible. Nothing contained herein shall be construed
as
prohibiting the Company from pursuing another remedy available
to it for
failing to keep your promise, including the recovery of any damage
which
it is able to prove and any other remedies allowed under any other
agreement with the Company or provided for under various Company
plans. In
addition, as a penalty and not in lieu of other damages the Company
may be
able
to prove, you agree to pay the Company liquidated damages in an
amount
equal to the total consulting fees received under Section 6 of
the
Agreement, or used as an offset under Section 16 of this Agreement,
if you
break your promise and divulge Confidential Information or break
any of
your promises under Sections 2, 4, 5, 10, 11, 12, or
15.
|
4. |
Confidential
Materials
:
You acknowledge that any information received by you during the execution
of your responsibilities for the Company in accordance with the Agreement,
which concerns the personal, financial or other affairs of the Company,
will be treated as Confidential Information in accordance with Section
3
above, and will not be revealed to any other persons, firms or
organizations.
|
5. |
Disparagement:
Each party acknowledges that the business reputation of the other
is a
valuable asset of such other party. Each party agrees that it shall
take
no action which can be deemed to be inimical to the best interests
of the
other party, including but not limited to: publishing material that
disparages the other party, participating in interviews disparaging
the
other party or taking action in any other manner or way disparaging
the
other party. In the event that a party takes an action that is deemed
to
be inimical to the best interests of the other party, the party committing
the breach shall pay liquidated damages to the other party in an
amount
equal to the value of the total consulting fees paid/received under
Section 6 or used as an offset under Section 16 of this Agreement,
and if
the breaching party is you this Agreement will be terminated by the
Company.
|
6. |
Compensation
:
As
consideration for your services during the term of this Agreement
and for
your active support for the Company and key leaders, the Company
will,
during the course of this Agreement, pay you at a rate of $75,000
for each
calendar quarter during which you provide services hereunder, beginning
March 1, 2006 and ending November 30, 2006; provided, however, that
such amount should be prorated for any pay period that is less than
three
full months. Such payments shall be paid to you by Ford quarterly
in
advance.
|
7. |
Expenses:
The Company will reimburse you for customary and reasonable
business-related expenses and travel that we authorize you to take,
consistent with Ford policies and procedures, during the term of
this
Agreement. This Agreement does not entitle you to the use of Company
aircraft. On a monthly basis, you will provide to the Group Vice
President, Human Resources and Labor Affairs, such documentation
as is
reasonably necessary to support the reimbursement of such expenses.
The
Company reserves the right to request additional documentation to
support
the reimbursement of such expenses.
|
8. |
Other
support:
You
will be provided with an office and computer support when in Dearborn,
Michigan, and will be provided travel support by the Executive Travel
Office in making aircraft travel arrangements in connection with
work
performed under this Agreement.
|
9. |
Indemnification
:
Your
relationship to Ford under this Agreement shall be that of an independent
contractor in the performance of the duties under this Agreement.
However,
you will be indemnified by Ford for all losses and other damages
that you
may sustain in performing services hereunder within the scope of
your
consultancy to the same extent as you would be if you were an employee
of
the Company under Ford's Certificate of
Incorporation.
|
10. |
Recruitment
:
During the term of this Agreement, you will not recruit any employee
from
Ford Motor Company or otherwise counsel any employee in Ford or its
subsidiaries to leave the Company. In addition, you will not provide
counsel or comments to any outside organization or individual regarding
skills, competencies, position responsibilities, performance, recruiting,
development, or succession planning regarding any employee in the
Company.
Breach of this provision shall be subject to the remedies described
in
Section 3.
|
11. |
Customers
and suppliers:
During the term of this Agreement, you shall not, directly or indirectly,
as an employee, agent, consultant, stockholder, director, co-partner
or in
any individual or representative capacity intentionally solicit or
encourage any present or future customer or supplier of the Company
to
terminate or otherwise alter its relationship with the Company in
an
adverse manner. Breach of this provision shall be subject to the
remedies
described in Section 3.
|
12. |
Information
and conflicts
:
All
information and data you develop or acquire in performing the services
hereunder shall belong to Ford, without further consideration, and
shall
be delivered to Ford upon completion of this Agreement or earlier
if
requested. Ford shall be free to use and disclose to others information
and data you deliver to Ford.
|
13. |
Termination:
This
Agreement may be terminated by either you or Ford at any time upon
30 days
written notice provided by the terminating party to the other. Except
as
otherwise provided in Section 16, no such termination by either party
will
affect the obligation of Ford to pay compensation for services rendered,
or to reimburse travel and business expenses incurred prior to such
termination, or any other provision of this
agreement.
|
14. |
Applicable
Law
:
This
Agreement shall be governed by and construed in accordance with the
laws
of the State of Michigan, without reference to principles of conflict
of
laws.
|
15. |
Confidentiality
of this Agreement:
Both
you and Ford shall use reasonable efforts to keep the existence and
terms
of this agreement confidential except to the extent required by law
to be
disclosed. If there is a legitimate request by governmental or similar
authority for its disclosure, the party receiving the request will
promptly notify the other of the nature of and details surrounding
the
request.
|
16. |
Offset
Provision
:
In
the event the Company determines that you are obligated to reimburse
the
Company for any amounts paid to you in excess of what is due to you
under
this Agreement, the Company may at its sole discretion and without
notice
withhold from payment to you all amounts due to you from the Company
under
this agreement until the amount due the Company is fully paid, to
the
extent permitted by applicable law.
|
17. |
Other
Agreements:
This Agreement is the only agreement between the parties with respect
to
consulting services and shall replace any prior understandings, oral
or
written, regarding any consulting
services.
|
Restated
(See
Note 28 of the Notes to the Financial Statements)
|
||||||||||||||||
|
For
the Years Ended December 31
|
|||||||||||||||
|
2005
|
2004
|
2003
|
2002
|
2001
|
|||||||||||
Earnings
|
||||||||||||||||
Income
before income taxes and cumulative effects of changes in accounting
principles (a)
|
$
|
1,079
|
$
|
4,109
|
$
|
914
|
$
|
4,036
|
$
|
(6,372
|
)
|
|||||
Less:
Equity in net (income)/loss of affiliates include in income before
income
taxes
|
(303
|
)
|
(240
|
)
|
(155
|
)
|
137
|
351
|
||||||||
Adjusted
income
|
776
|
3,869
|
759
|
4,173
|
(6,021
|
)
|
||||||||||
Adjusted
fixed charges (b)
|
9,091
|
9,136
|
9,996
|
10,977
|
11,911
|
|||||||||||
Earnings
|
$
|
9,867
|
$
|
13,005
|
$
|
10,755
|
$
|
15,150
|
$
|
5,890
|
||||||
Combined
Fixed Charges and Preferred Stock Dividends
|
||||||||||||||||
Interest
expense (c)
|
$
|
8,484
|
$
|
8,528
|
$
|
9,236
|
$
|
10,128
|
$
|
11,482
|
||||||
Interest
portion of rental expense (d)
|
514
|
565
|
524
|
448
|
394
|
|||||||||||
Preferred
Stock dividend requirements of majority owned subsidiaries and
trusts
|
—
|
—
|
190
|
353
|
55
|
|||||||||||
Fixed
charges
|
8,998
|
9,093
|
9,950
|
10,929
|
11,931
|
|||||||||||
Ford
Preferred Stock dividend requirements (e)
|
—
|
—
|
—
|
22
|
22
|
|||||||||||
Total
combined fixed charges and Preferred Stock dividends
|
$
|
8,998
|
$
|
9,093
|
$
|
9,950
|
$
|
10,951
|
$
|
11,953
|
||||||
Ratios
|
||||||||||||||||
Ratio
of earnings to fixed charges
|
1.1
|
1.4
|
1.1
|
1.4
|
(f
|
)
|
||||||||||
Ratio
of earnings to combined fixed charges and Preferred Stock
dividends
|
1.1
|
1.4
|
1.1
|
1.4
|
(f
|
)
|
||||||||||
Discontinued
operations are excluded from all amounts.
|
(a)
|
Income
before taxes includes equity income from unconsolidated
subsidiaries.
|
(b)
|
Fixed
charges, as shown above, adjusted to exclude the amount of interest
capitalized during the period and Preferred Stock dividend requirements
of
majority owned subsidiaries and trusts. (Capitalized interest: 2005
— $67
mil; 2004 — $57 mil; 2003 — $63 mil; 2002 — $46 mil; 2001 — $44
mil)
|
(c)
|
Includes
interest, whether expensed or capitalized, and amortization of debt
expense and discount or premium relating to any
indebtedness.
|
(d)
|
One-third
of all rental expense is deemed to be
interest.
|
(e)
|
Preferred
Stock dividend requirements of Ford Motor Company were increased
to an
amount representing the pre-tax earnings which would be required
to cover
such dividend requirements based on Ford Motor Company’s effective income
tax rates.
|
(f)
|
Earnings
for the year ended December 31, 2001 were inadequate to cover fixed
charges by $6.1 billion.
|
SUBSIDIARIES
OF FORD MOTOR COMPANY AS OF FEBRUARY 22, 2006*
|
||||||
ORGANIZATION
|
Jurisdiction
|
|||||
3000
Schaefer Road Company
|
Michigan,
U.S.A.
|
|||||
Closed
Joint Stock Company Ford Motor Company
|
Russia
|
|||||
Ford
Automotive International Holding, S.L.
|
Spain
|
|||||
Ford
Capital B.V.
|
The
Netherlands
|
|||||
Ford
Motor Company (Belgium) N.V.
|
Belgium
|
|||||
Ford
Nederland B.V.
|
The
Netherlands
|
|||||
Ford
Espana S.A.
|
Spain
|
|||||
Ford
Italia S.p.A..
|
Italy
|
|||||
Groupe
FMC France SAS
|
France
|
|||||
FMC
Automobiles SAS
|
France
|
|||||
Volvo
Espana S.L.
|
Spain
|
|||||
Ford
European Holdings LLC
|
Delaware,
U.S.A.
|
|||||
Ford
Deutschland Holding GmbH
|
Germany
|
|||||
Ford-Werke
GmbH
|
Germany
|
|||||
Volvo
Car Germany GmbH
|
Germany
|
|||||
Ford
Global Technologies, LLC
|
Delaware,
U.S.A.
|
|||||
Ford
Motor Company Brasil Ltda.
|
Brazil
|
|||||
Ford
Holdings LLC
|
Delaware,
U.S.A.
|
|||||
Ford
Motor Credit Company
|
Delaware,
U.S.A.
|
|||||
CAB
East Holdings, LLC
|
Delaware,
U.S.A.
|
|||||
CAB
East LLC
|
Delaware,
U.S.A.
|
|||||
Ford
Credit Auto Lease, LLC
|
Delaware,
U.S.A.
|
|||||
Ford
Credit Auto Lease Trust 2004-A
|
Delaware,
U.S.A.
|
|||||
Ford
Credit Auto Receivables Two, LLC
|
Delaware,
U.S.A.
|
|||||
Ford
Credit Auto Owner Trust 2004-1
|
Delaware,
U.S.A.
|
|||||
Ford
Credit International, Inc.
|
Delaware,
U.S.A.
|
|||||
FCE
Bank plc
|
England
|
|||||
Ford
Credit Canada Limited
|
Canada
|
|||||
Ford
Credit Canada Leasing Company
|
Canada
|
|||||
Primus
Automotive Financial Services Canada Company
|
Canada
|
|||||
Ford
Credit de Mexico S.A. de C.V.
|
Mexico
|
|||||
Ford
Credit Floorplan Corporation
|
Delaware,
U.S.A.
|
|||||
Ford
Credit Floorplan, LLC
|
Delaware,
U.S.A.
|
|||||
Ford
Credit Floorplan Master Owner Trust A
|
Delaware,
U.S.A.
|
|||||
Primus
Automotive Financial Services, Inc
|
New
York, U.S.A.
|
|||||
The
American Road Insurance Company
|
Michigan,
U.S.A.
|
|||||
Ford
Motor Land Development Corporation
|
Delaware,
U.S.A.
|
|||||
Ford
International Capital Corporation
|
Delaware,
U.S.A.
|
|||||
Ford
Automotive Holdings
|
England
|
|||||
Blue
Oval Holdings
|
England
|
|||||
Ford
Motor Company Limited
|
England
|
|||||
Volvo
Car UK Limited
|
England
|
|||||
Jaguar
Limited
|
England
|
|||||
Jaguar
Cars Limited
|
England
|
|||||
Ford
Mexico Holdings, Inc.
|
Delaware,
U.S.A.
|
|||||
Grupo
Ford S. de R.L. de C.V.
|
Mexico
|
|||||
Ford
Motor Company, S.A. de C.V.
|
Mexico
|
Re:
|
Ford
Motor Company Registration Statements Nos. 2-95018,
2-95020,
|
/s/
Peter J. Sherry, Jr.
|
||
Peter
J. Sherry, Jr.
|
||
Secretary
|
/s/
William Clay Ford, Jr.
|
|
(William
Clay Ford, Jr.)
|
|
/s/
John R. H. Bond
|
|
(John
R. H. Bond)
|
|
/s/
Stephen G. Butler
|
|
(Stephen
G. Butler)
|
|
/s/
Kimberly A. Casiano
|
|
(Kimberly
A. Casiano)
|
|
/s/
Edsel B. Ford II
|
|
(Edsel
B. Ford II)
|
|
/s/
Irvine O. Hockaday, Jr.
|
|
(Irvine
O. Hockaday, Jr.)
|
|
/s/
Marie-Josée Kravis
|
|
(Marie-Josée
Kravis)
|
|
/s/
Richard A. Manoogian
|
|
(Richard
A. Manoogian)
|
|
/s/
Ellen R. Marram
|
|
(Ellen
R. Marram)
|
|
/s/
Homer A. Neal
|
|
(Homer
A. Neal)
|
|
/s/
Jorma Ollila
|
|
(Jorma
Ollila)
|
/s/
James J. Padilla
|
|
(James
J. Padilla)
|
|
/s/
Carl E. Reichardt
|
|
(Carl
E. Reichardt)
|
|
/s/
Robert E. Rubin
|
|
(Robert
E. Rubin)
|
|
/s/
John L. Thornton
|
|
(John
L. Thornton)
|
|
/s/
Donat R. Leclair, Jr.
|
|
(Donat
R. Leclair, Jr.)
|
|
/s/
James C. Gouin
|
|
(James
C. Gouin)
|
1.
|
I
have reviewed this Annual Report on Form 10-K/A for the year ended
December 31, 2005 of Ford Motor
Company;
|
2.
|
Based
on my knowledge, this report does not contain any untrue statement
of a
material fact or omit to state a material fact necessary to make
the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
|
3.
|
Based
on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects
the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this
report;
|
4.
|
The
registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the registrant and
have:
|
(a)
Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision,
to ensure that material information relating to the registrant, including
its consolidated subsidiaries, is made known to us by others within
those
entities, particularly during the period in which this report is
being
prepared;
|
(b)
Designed such internal control over financial reporting, or caused
such
internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability
of
financial reporting and the preparation of financial statements for
external purposes in accordance with generally accepted accounting
principles;
|
(c)
Evaluated the effectiveness of the registrant's disclosure controls
and
procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the
end of
the period covered by this report based on such evaluation;
and
|
(d)
Disclosed in this report any change in the registrant's internal
control
over financial reporting that occurred during the registrant's most
recent
fiscal quarter (the registrant's fourth fiscal quarter in the case
of an
annual report) that has materially affected, or is reasonably likely
to
materially affect, the registrant's internal control over financial
reporting; and
|
5.
|
The
registrant's other certifying officer(s) and I have disclosed, based
on
our most recent evaluation of internal control over financial reporting,
to the registrant's auditors and the audit committee of the registrant's
board of directors (or persons performing the equivalent
functions):
|
/s/
Alan Mulally
|
||
Alan
Mulally
|
||
President
and Chief Executive Officer
|
1.
|
I
have reviewed this Annual Report on Form 10-K/A for the year ended
December 31, 2005 of Ford Motor
Company;
|
2.
|
Based
on my knowledge, this report does not contain any untrue statement
of a
material fact or omit to state a material fact necessary to make
the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
|
3.
|
Based
on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects
the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this
report;
|
4.
|
The
registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the registrant and
have:
|
5.
|
The
registrant's other certifying officer(s) and I have disclosed, based
on
our most recent evaluation of internal control over financial reporting,
to the registrant's auditors and the audit committee of the registrant's
board of directors (or persons performing the equivalent
functions):
|
(a)
All significant deficiencies and material weaknesses in the design
or
operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to
record,
process, summarize and report financial information;
and
|
(b)
Any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
control
over financial reporting.
|
/s/
Donat R. Leclair, Jr.
|
||
Donat
R. Leclair, Jr.
|
||
Executive
Vice President and
|
||
Chief
Financial Officer
|
1.
|
the
Company's Annual Report on Form 10-K/A for the year ended December
31,
2005, to which this statement is furnished as an exhibit (the "Report"),
fully complies with the requirements of section 13(a) or 15(d) of
the
Securities Exchange Act of 1934, as amended;
and
|
2.
|
the
information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the
Company.
|
/s/
Alan Mulally
|
||
Alan
Mulally
|
||
President
and Chief Executive Officer
|
||
1.
|
the
Company's Annual Report on Form 10-K/A for the year ended December
31,
2005, to which this statement is furnished as an exhibit (the "Report"),
fully complies with the requirements of section 13(a) or 15(d) of
the
Securities Exchange Act of 1934, as amended;
and
|
2.
|
the
information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the
Company.
|
/s/
Donat R. Leclair, Jr.
|
||
Donat
R. Leclair, Jr.
|
||
Executive
Vice President and
|
||
Chief
Financial Officer
|