FORD MOTOR CO (Form: 10-Q, Received: 11/14/2006 08:08:22)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d ) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2006

o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______________ to _______________

Commission File Number: 1-3950

FORD MOTOR COMPANY

(Exact name of registrant as specified in its charter)

1-3950	38-0549190
(Commission File Number)	(IRS Employer Identification No.)

One American Road, Dearborn, Michigan	48126
(Address of principal executive offices)	(Zip Code)

(313) 322-3000

(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days

x Yes o No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of "accelerated filer and large accelerated filer" in Rule 12b-2 of the Exchange Act.

Large accelerated filer x

Accelerated filer o

Non-accelerated filer o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

o Yes x No

As of November 6, 2006, the registrant had outstanding 1,818,041,779 shares of Common Stock and 70,852,076 shares of Class B Stock.

Exhibit index located on page number 58.

EXPLANATORY NOTE

In October 2006, Ford Motor Company (generally, "Ford," "we," "us" or "our") reviewed our application of paragraph 68 of Statement of Financial Accounting Standards ("SFAS") No. 133, Accounting for Derivative Instruments and Hedging Activities , as amended, and its use at our indirect wholly-owned subsidiary, Ford Motor Credit Company ("Ford Credit"). One of the general requirements of SFAS No. 133 is that hedge accounting is appropriate only for those hedging relationships that a company expects will be highly effective in achieving offsetting changes in fair value or cash flows attributable to the risk being hedged. To determine whether transactions satisfy this requirement, companies must periodically assess the effectiveness of hedging relationships both prospectively and retrospectively. Paragraph 68 of SFAS No. 133 ("Paragraph 68") contains an exception from these periodic assessment requirements in the form of an "assumption of no ineffectiveness" for certain hedges of interest rate risk that involve interest rate swaps and recognized interest-bearing assets or liabilities. The exception identifies the specific requirements for the derivative and hedged items that must be met, such as a derivative fair value of zero at inception of the hedging relationship, matching maturity dates, and contemporaneous formal documentation.

Based on our review, we concluded that all of our interest rate swaps were and continue to be highly effective economic hedges; nearly all of these transactions, however, failed to meet the requirements set forth in Paragraph 68, primarily because:

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.

Although we now have determined that the hedging relationships at issue in this restatement did not meet the specific criteria for an assumption of no ineffectiveness pursuant to Paragraph 68, we are precluded by SFAS No. 133 from retroactively performing full effectiveness testing in order to apply hedge accounting. Accordingly, the restated results in our Annual Report on Form 10-K/A for the year ended December 31, 2005 ("2005 Form 10-K/A Report") reflect the changes in fair value of these instruments as derivative gains and losses during the affected periods, without recording any offsetting change in the value of the debt they were economically hedging.

As a result, we have filed our 2005 Form 10-K/A Report restating certain financial information therein including: historical balance sheets as of December 31, 2005 and 2004; statements of income, cash flows and stockholders’ equity for the years ending 2005, 2004, and 2003; and selected financial data as of and for the years ended December 31, 2005, 2004, 2003, 2002 and 2001.

Changes in the fair value of interest rate swaps are driven primarily by changes in interest rates. We have long-term interest rate swaps with large notional balances, many of which are "receive-fixed, pay-float" interest rate swaps. Such swaps increase in value when interest rates decline, and decline in value when interest rates rise. As a result, changes in interest rates cause substantial volatility in the fair values that must be recognized in earnings. For 2001 and 2002, when interest rates were trending lower, we have recognized large derivative gains in our restated financial data. The upward trend in interest rates from 2003 through 2005 caused our interest rate swaps to decline in value, resulting in the recognition of derivative losses for these periods.

See Note 28 of the Notes to the Financial Statements in our 2005 Form 10-K/A Report for additional information and amounts related to our restatement. In addition, this Quarterly Report on Form 10-Q for the period ended September 30, 2006 includes, in Note 2 of the Notes to the Financial Statements, restated consolidated and sector statements of income for the three- and nine-month periods ended September 30, 2005, restated consolidated and sector balance sheets as of December 31, 2005, and restated condensed consolidated and sector statements of cash flows for the nine-month period ended September 30, 2005.

The following table sets forth a reconciliation of previously reported and restated net income/(loss) for the periods shown (in millions):

	2005 Net Income/(Loss)

	Third Quarter			First Nine Months

Previously reported	$	(284	)	$	1,874
Pre-tax adjustments:
Fair value interest rate swaps		(435	)		(624	)
Other out-of-period adjustments		(31	)		63
Total pre-tax adjustments		(466	)		(561	)
Related tax effects - provision for/(benefit from)		(174	)		(201	)
Net after-tax adjustments		(292	)		(360	)
Restated	$	(576	)	$	1,514

Subsequent to the completion of our originally-filed financial statements for each period being restated, we identified adjustments that should have been recorded in these earlier periods. Upon identification, we determined these adjustments to be immaterial, individually and in the aggregate, to our originally-filed financial statements, and generally recognized these adjustments ("out-of-period" adjustments) in the period in which they were identified. Because the Ford Credit interest rate swap adjustment has required a restatement, we also are reversing these out-of-period adjustments and recording them in the proper periods.

We do not intend to amend previously-filed Quarterly Reports on Form 10-Q for periods ending prior to December 31, 2005. The reader should not rely on our previously-filed Quarterly Report on Form 10-Q for the period ended September 30, 2005, but should instead rely upon the updated financial data provided for the third quarter and nine months ended September 30, 2005 herein.

PART I. FINANCIAL INFORMATION

ITEM 1 .

Financial Statements.

FORD MOTOR COMPANY AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF INCOME

For the Periods Ended September 30, 2006 and 2005

(in millions, except per share amounts)

	Third Quarter						First Nine Months
				Restated - See Note 2						Restated - See Note 2
	2006			2005			2006			2005
	(unaudited)						(unaudited)
Sales and revenues
Automotive sales	$	32,556		$	34,656		$	107,356		$	112,778
Financial Services revenues		4,554			5,854			12,449			17,793
Total sales and revenues		37,110			40,510			119,805			130,571

Costs and expenses
Automotive cost of sales		37,554			33,471			110,340			105,786
Selling, administrative and other expenses		4,496			5,983			13,730			18,181
Interest expense		1,936			2,157			6,330			6,287
Financial Services provision for credit and insurance losses		97			182			193			350
Total costs and expenses		44,083			41,793			130,593			130,604

Automotive interest income and other non-operating income/(expense), net		555			307			1,080			1,111
Automotive equity in net income/(loss) of affiliated companies		61			133			345			259
Income/(loss) before income taxes		(6,357	)		(843	)		(9,363	)		1,337
Provision for/(benefit from) income taxes		(1,157	)		(314	)		(2,499	)		(328	)
Income/(loss) before minority interests		(5,200	)		(529	)		(6,864	)		1,665
Minority interests in net income/(loss) of subsidiaries		48			54			126			196
Income/(loss) from continuing operations		(5,248	)		(583	)		(6,990	)		1,469
Income/(loss) from discontinued operations (Note 4)		—			7			2			45
Net income/(loss)	$	(5,248	)	$	(576	)	$	(6,988	)	$	1,514

AMOUNTS PER SHARE OF COMMON AND CLASS B STOCK (Note 12)
Basic income/(loss)
Income/(loss) from continuing operations	$	(2.79	)	$	(0.31	)	$	(3.73	)	$	0.80
Income/(loss) from discontinued operations		—			—			—			0.02
Net income/(loss)	$	(2.79	)	$	(0.31	)	$	(3.73	)	$	0.82
Diluted income/(loss)
Income/(loss) from continuing operations	$	(2.79	)	$	(0.31	)	$	(3.73	)	$	0.76
Income/(loss) from discontinued operations		—			—			—			0.03
Net income/(loss)	$	(2.79	)	$	(0.31	)	$	(3.73	)	$	0.79
Cash dividends	$	0.05		$	0.10		$	0.25		$	0.30

The accompanying notes are part of the financial statements

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

SECTOR STATEMENT OF INCOME

For the Periods Ended September 30, 2006 and 2005

(in millions, except per share amounts)

	Third Quarter						First Nine Months
				Restated - See Note 2						Restated - See Note 2
	2006			2005			2006			2005
	(unaudited)						(unaudited)
AUTOMOTIVE
Sales	$	32,556		$	34,656		$	107,356		$	112,778
Costs and expenses
Cost of sales		37,554			33,471			110,340			105,786
Selling, administrative and other expenses		2,798			2,811			8,733			8,977
Total costs and expenses		40,352			36,282			119,073			114,763
Operating income/(loss)		(7,796	)		(1,626	)		(11,717	)		(1,985	)

Interest expense		(73	)		371			621			960

Interest income and other non-operating income/(expense), net		555			307			1,080			1,111
Equity in net income/(loss) of affiliated companies		61			133			345			259
Income/(loss) before income taxes — Automotive		(7,107	)		(1,557	)		(10,913	)		(1,575	)

FINANCIAL SERVICES
Revenues		4,554			5,854			12,449			17,793
Costs and expenses
Interest expense		2,009			1,786			5,709			5,327
Depreciation		1,400			1,537			3,899			4,591
Operating and other expenses		298			1,635			1,098			4,613
Provision for credit and insurance losses		97			182			193			350
Total costs and expenses		3,804			5,140			10,899			14,881
Income/(loss) before income taxes — Financial Services		750			714			1,550			2,912

TOTAL COMPANY
Income/(loss) before income taxes		(6,357	)		(843	)		(9,363	)		1,337
Provision for/(benefit from) income taxes		(1,157	)		(314	)		(2,499	)		(328	)
Income/(loss) before minority interests		(5,200	)		(529	)		(6,864	)		1,665
Minority interests in net income/(loss) of subsidiaries		48			54			126			196
Income/(loss) from continuing operations		(5,248	)		(583	)		(6,990	)		1,469
Income/(loss) from discontinued operations (Note 4)		—			7			2			45
Net income/(loss)	$	(5,248	)	$	(576	)	$	(6,988	)	$	1,514

AMOUNTS PER SHARE OF COMMON AND CLASS B STOCK (Note 12)
Basic income/(loss)
Income/(loss) from continuing operations	$	(2.79	)	$	(0.31	)	$	(3.73	)	$	0.80
Income/(loss) from discontinued operations		—			—			—			0.02
Net income/(loss)	$	(2.79	)	$	(0.31	)	$	(3.73	)	$	0.82
Diluted income/(loss)
Income/(loss) from continuing operations	$	(2.79	)	$	(0.31	)	$	(3.73	)	$	0.76
Income/(loss) from discontinued operations		—			—			—			0.03
Net income/(loss)	$	(2.79	)	$	(0.31	)	$	(3.73	)	$	0.79
Cash dividends	$	0.05		$	0.10		$	0.25		$	0.30

The accompanying notes are part of the financial statements

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET

(in millions)

	September 30, 2006			Restated - see Note 2 December 31, 2005
	(unaudited)
ASSETS
Cash and cash equivalents	$	25,511		$	28,406
Marketable securities		14,552			10,672
Loaned securities		564			3,461
Finance receivables, net		106,685			105,975
Other receivables, net		8,004			8,536
Net investment in operating leases		30,943			27,099
Retained interest in sold receivables		1,073			1,420
Inventories (Note 6)		11,997			10,271
Equity in net assets of affiliated companies		2,828			2,579
Net property		37,844			40,676
Deferred income taxes		4,197			5,880
Goodwill and other intangible assets (Note 9)		6,396			5,945
Assets of discontinued/held-for-sale operations		—			5
Other assets		16,871			18,534
Total assets	$	267,465		$	269,459

LIABILITIES AND STOCKHOLDERS’ EQUITY
Payables	$	22,738		$	22,910
Accrued liabilities and deferred revenue		77,365			73,047
Debt		154,410			153,278
Deferred income taxes		2,774			5,660
Total liabilities		257,287			254,895

Minority interests		1,015			1,122

Stockholders’ equity
Capital stock
Common Stock, par value $0.01 per share (1,837 million shares issued)		18			18
Class B Stock, par value $0.01 per share (71 million shares issued)		1			1
Capital in excess of par value of stock		4,579			4,872
Accumulated other comprehensive income/(loss)		(785	)		(3,680	)
Treasury stock		(258	)		(833	)
Retained earnings		5,608			13,064
Total stockholders’ equity		9,163			13,442
Total liabilities and stockholders’ equity	$	267,465		$	269,459

The accompanying notes are part of the financial statements

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

SECTOR BALANCE SHEET

(in millions)

	September 30, 2006			Restated - See Note 2 December 31, 2005
	(unaudited)
ASSETS
Automotive
Cash and cash equivalents	$	13,531		$	13,388
Marketable securities		7,768			6,860
Loaned securities		564			3,461
Total cash, marketable and loaned securities		21,863			23,709
Receivables, net		3,551			3,075
Inventories (Note 6)		11,997			10,271
Deferred income taxes		657			1,249
Other current assets		7,891			8,177
Total current assets		45,959			46,481
Equity in net assets of affiliated companies		2,026			1,756
Net property		37,533			40,348
Deferred income taxes		13,023			10,999
Goodwill and other intangible assets (Note 9)		6,379			5,928
Assets of discontinued/held-for-sale operations		—			5
Other assets		9,006			8,308
Total Automotive assets		113,926			113,825
Financial Services
Cash and cash equivalents		11,980			15,018
Marketable securities		6,784			3,812
Finance receivables, net		111,138			111,436
Net investment in operating leases		26,286			22,951
Retained interest in sold receivables		1,073			1,420
Goodwill and other intangible assets (Note 9)		17			17
Other assets		5,921			7,457
Receivable from Automotive		994			83
Total Financial Services assets		164,193			162,194
Intersector elimination		(994	)		(83	)
Total assets	$	277,125		$	275,936

LIABILITIES AND STOCKHOLDERS’ EQUITY
Automotive
Trade payables	$	17,895		$	16,637
Other payables		3,163			4,222
Accrued liabilities and deferred revenue		29,545			28,829
Deferred income taxes		1,152			804
Debt payable within one year		1,289			978
Current payable to Financial Services		285			83
Total current liabilities		53,329			51,553
Long-term debt		16,376			16,900
Other liabilities		43,214			38,639
Deferred income taxes		466			586
Non-current payable to Financial Services		709			—
Total Automotive liabilities		114,094			107,678
Financial Services
Payables		1,680			2,051
Debt		136,745			135,400
Deferred income taxes		10,816			10,747
Other liabilities and deferred income		4,606			5,579
Total Financial Services liabilities		153,847			153,777

Minority interests		1,015			1,122

Stockholder s’ equity
Capital stock
Common Stock, par value $0.01 per share (1,837 million shares issued)		18			18
Class B Stock, par value $0.01 per share (71 million shares issued)		1			1
Capital in excess of par value of stock		4,579			4,872
Accumulated other comprehensive income/(loss)		(785	)		(3,680	)
Treasury stock		(258	)		(833	)
Retained earnings		5,608			13,064
Total stockholders’ equity		9,163			13,442
Intersector elimination		(994	)		(83	)
Total liabilities and stockholders’ equity	$	277,125		$	275,936

The accompanying notes are part of the financial statements

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

For the Periods Ended September 30, 2006 and 2005

(in millions)

	First Nine Months
				Restated -
				See Note 2
	2006			2005
	(unaudited)

Cash flows from operating activities of continuing operations
Net cash (used in)/provided by operating activities	$	16,975		$	19,282

Cash flows from investing activities of continuing operations
Capital expenditures		(5,242	)		(5,462	)
Acquisitions of retail and other finance receivables and operating leases		(47,688	)		(42,026	)
Collections of retail and other finance receivables and operating leases		31,741			36,492
Net acquisitions of daily rental vehicles		—			(2,183	)
Purchases of securities		(17,471	)		(10,100	)
Sales and maturities of securities		15,196			4,197
Proceeds from sales of retail and other finance receivables and operating leases		3,956			15,144
Proceeds from sale of businesses		54			2,245
Cash paid for acquisitions		—			(1,617	)
Transfer of cash balances upon disposition of discontinued/held-for-sale operations		(4	)		(4	)
Other		143			2,229
Net cash (used in)/provided by investing activities		(19,315	)		(1,085	)

Cash flows from financing activities of continuing operations
Cash dividends		(468	)		(552	)
Sales of Common Stock		355			697
Purchases of Common Stock		(139	)		(447	)
Changes in short-term debt		(276	)		(6,234	)
Proceeds from issuance of other debt		32,775			21,677
Principal payments on other debt		(33,012	)		(32,516	)
Other		(34	)		(28	)
Net cash (used in)/provided by financing activities		(799	)		(17,403	)

Effect of exchange rate changes on cash		238			(376	)

Net increase/(decrease) in cash and cash equivalents from continuing operations		(2,901	)		418

Cash flows from discontinued operations
Cash flows from operating activities of discontinued operations		2			65
Cash flows from investing activities of discontinued operations		—			(50	)
Cash flows from financing activities of discontinued operations		—			—

Net increase/(decrease) in cash and cash equivalents	$	(2,899	)	$	433

Cash and cash equivalents at January 1	$	28,406		$	22,828
Cash and cash equivalents of discontinued/held-for-sale operations at January 1		4			681
Net increase/(decrease) in cash and cash equivalents		(2,899	)		433
Less: cash and cash equivalents of discontinued/held-for-sale operations at September 30		—			(790	)
Cash and cash equivalents at September 30	$	25,511		$	23,152

The accompanying notes are part of the financial statements

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

CONDENSED SECTOR STATEMENT OF CASH FLOWS

For the Periods Ended September 30, 2006 and 2005

(in millions)

							Restated - S ee Note 2
	First Nine Months 2006						First Nine Months 2005
	Automotive			Financial Services			Automotive			Financial Services
	(unaudited)						(unaudited)
Cash flows from operating activities of continuing operations
Net cash (used in)/provided by operating activities	$	5,020		$	5,471		$	4,532		$	5,887

Cash flows from investing activities
Capital expenditures		(5,212	)		(30	)		(5,109	)		(353	)
Acquisitions of retail and other finance receivables and operating leases		—			(47,688	)		—			(42,026	)
Collections of retail and other finance receivables and operating leases		—			32,099			—			36,579
Net (increase)/decrease of wholesale receivables		—			6,126			—			5,629
Net acquisitions of daily rental vehicles		—			—			—			(2,775	)
Purchases of securities		(3,641	)		(13,830	)		(4,343	)		(5,757	)
Sales and maturities of securities		4,095			11,101			3,239			958
Proceeds from sales of retail and other finance receivables and operating leases		—			3,956			—			15,144
Proceeds from sales of wholesale receivables		—			—			—			3,739
Proceeds from sale of businesses		54			—			204			2,041
Transfer of cash balances upon disposition of discontinued/held-for-sale operations		(4	)		—			1			(5	)
Investing activity from Financial Services		785			—			2,486			—
Investing activity to Financial Services		(1,400	)		—			—			—
Cash paid for acquisitions		—			—			(1,617	)		—
Other		(61	)		204			453			1,776
Net cash (used in)/provided by investing activities		(5,384	)		(8,062	)		(4,686	)		14,950

Cash flows from financing activities
Cash dividends		(468	)		—			(552	)		—
Sales of Common Stock		355			—			697			—
Purchases of Common Stock		(139	)		—			(447	)		—
Changes in short-term debt		251			(527	)		(3	)		(6,231	)
Proceeds from issuance of other debt		204			32,571			253			21,424
Principal payments on other debt		(629	)		(32,383	)		(682	)		(31,834	)
Financing activity from Automotive		—			1,400			—			—
Financing activity to Automotive		—			(785	)		—			(2,486	)
Other		76			(110	)		(4	)		(24	)
Net cash (used in)/provided by financing activities		(350	)		166			(738	)		(19,151	)

Effect of exchange rate changes on cash		3			235			14			(390	)
Net change in intersector receivables/payables and other liabilities		848			(848	)		(168	)		168
Net increase/(decrease) in cash and cash equivalents from continuing operations		137			(3,038	)		(1,046	)		1,464

Cash flows from discontinued operations
Cash flows from operating activities of discontinued operations		2			—			(6	)		71
Cash flows from investing activities of discontinued operations		—			—			16			(66	)
Cash flows from financing activities of discontinued operations		—			—			—			—

Net increase/(decrease) in cash and cash equivalents	$	139		$	(3,038	)	$	(1,036	)	$	1,469

Cash and cash equivalents at January 1	$	13,388		$	15,018		$	10,139		$	12,689
Cash and cash equivalents of discontinued/held-for-sale operations at January 1		4			—			2			679
Net increase/(decrease) in cash and cash equivalents		139			(3,038	)		(1,036	)		1,469
Less: cash and cash equivalents of discontinued/held-for-sale operations at September 30		—			—			(13	)		(777	)
Cash and cash equivalents at September 30	$	13,531		$	11,980		$	9,092		$	14,060

The accompanying notes are part of the financial statements

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 1. FINANCIAL STATEMENTS

The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States for interim financial information, and instructions to the Quarterly Report on Form 10-Q and Rule 10-01 of Regulation S-X. In the opinion of management, these unaudited financial statements reflect those adjustments necessary for a fair statement of the results of operations and financial condition of Ford Motor Company and its consolidated subsidiaries and consolidated variable interest entities ("VIEs") of which we are the primary beneficiary for the periods and at the dates presented. Results for interim periods should not be considered indicative of results for a full year. Reference should be made to the financial statements contained in our Annual Report on Form 10-K/A for the year ended December 31, 2005 (the "2005 Form 10-K/A Report"). For purposes of this report, "Ford", the "Company", "we", "our", "us" or similar references mean Ford Motor Company and our consolidated subsidiaries and our consolidated VIEs of which we are the primary beneficiary, unless the context requires otherwise.

NOTE 2. RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

In October 2006, we reviewed our application of paragraph 68 of Statement of Financial Accounting Standards ("SFAS") No. 133, Accounting for Derivative Instruments and Hedging Activities , as amended, and its use at our indirect wholly-owned subsidiary, Ford Motor Credit Company ("Ford Credit"). One of the general requirements of SFAS No. 133 is that hedge accounting is appropriate only for those hedging relationships that a company expects will be highly effective in achieving offsetting changes in fair value or cash flows attributable to the risk being hedged. To determine whether transactions satisfy this requirement, companies must periodically assess the effectiveness of hedging relationships both prospectively and retrospectively. Paragraph 68 of SFAS No. 133 ("Paragraph 68") contains an exception from these periodic assessment requirements in the form of an "assumption of no ineffectiveness" for certain hedges of interest rate risk that involve interest rate swaps and recognized interest-bearing assets or liabilities. The exception identifies the specific requirements for the derivative and hedged items that must be met, such as a derivative fair value of zero at inception of the hedging relationship, matching maturity dates, and contemporaneous formal documentation.

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.

Item 1. Financial Statements (Continued)

See Note 28 of the Notes to the Financial Statements in our 2005 Form 10-K/A Report for additional information and amounts related to our restatement. In addition, this Quarterly Report on Form 10-Q for the period ended September 30, 2006 includes, in Note 2, restated consolidated and sector statements of income for the three- and nine-month periods ended September 30, 2005, restated consolidated and sector balance sheets as of December 31, 2005, and restated condensed consolidated and sector statements of cash flows for the nine-month period ended September 30, 2005.

The following table sets forth a reconciliation of previously reported and restated net income/(loss) for the periods shown (in millions):

	2005 Net Income/(Loss)

	Third Quarter			First Nine Months

Previously reported	$	(284	)	$	1,874
Pre-tax adjustments:
Fair value interest rate swaps		(435	)		(624	)
Other out-of-period adjustments		(31	)		63
Total pre-tax adjustments		(466	)		(561	)
Related tax effects - provision for/(benefit from)		(174	)		(201	)
Net after-tax adjustments		(292	)		(360	)
Restated	$	(576	)	$	1,514

We do not intend to amend previously-filed Quarterly Reports on Form 10-Q for periods ending prior to December 31, 2005. The reader should not rely on the financial information in our previously-filed Quarterly Report on Form 10-Q for the period ended September 30, 2005, but should instead rely upon the updated financial data provided for the third quarter and nine months ended September 30, 2005 herein.

Presentation of Cash Flows

Beginning with our year ended December 31, 2005 statements of cash flows, we have revised the presentation of cash flows to separately disclose the operating, investing, and financing portions of the cash flows attributable to our discontinued operations. This revision is in response to public statements by the staff of the Securities and Exchange Commission ("SEC") concerning classification of discontinued operations within the statement of cash flows.

Item 1. Financial Statements (Continued)

NOTE 2. RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Continued)

The following table presents the effect of the restatement on the Consolidated Statement of Income (in millions, except per share amounts):

	Third Quarter 2005						First Nine Months 2005
	Previously Reported			Restated			Previously Reported			Restated
	(unaudited)						(unaudited)
Sales and revenues
Automotive sales	$	34,675		$	34,656		$	112,692		$	112,778
Financial Services revenues		6,181			5,854			17,848			17,793
Total sales and revenues		40,856			40,510			130,540			130,571

Costs and expenses
Automotive cost of sales		33,532			33,471			105,803			105,786
Selling, administrative and other expenses		5,983			5,983			18,200			18,181
Interest expense		1,976			2,157			5,659			6,287
Financial Services provision for credit and insurance losses		182			182			350			350
Total costs and expenses		41,673			41,793			130,012			130,604

Automotive interest income and other non-operating income/(expense), net		307			307			1,111			1,111
Automotive equity in net income/(loss) of affiliated companies		133			133			259			259
Income/(loss) before income taxes		(377	)		(843	)		1,898			1,337
Provision for/(benefit from) income taxes		(140	)		(314	)		(127	)		(328	)
Income/(loss) before minority interests		(237	)		(529	)		2,025			1,665
Minority interests in net income/(loss) of subsidiaries		54			54			196			196
Income/(loss) from continuing operations		(291	)		(583	)		1,829			1,469
Income/(loss) from discontinued operations (Note 4)		7			7			45			45
Net income/(loss)	$	(284	)	$	(576	)	$	1,874		$	1,514

AMOUNTS PER SHARE OF COMMON AND CLASS B STOCK (Note 12)
Basic income/(loss)
Income/(loss) from continuing operations	$	(0.16	)	$	(0.31	)	$	0.99		$	0.80
Income/(loss) from discontinued operations		0.01			—			0.03			0.02
Net income/(loss)	$	(0.15	)	$	(0.31	)	$	1.02		$	0.82
Diluted income/(loss)
Income/(loss) from continuing operations	$	(0.16	)	$	(0.31	)	$	0.93		$	0.76
Income/(loss) from discontinued operations		0.01			—			0.02			0.03
Net income/(loss)	$	(0.15	)	$	(0.31	)	$	0.95		$	0.79
Cash dividends	$	0.10		$	0.10		$	0.30		$	0.30

Item 1. Financial Statements (Continued)

NOTE 2. RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Continued)

The following table presents the effect of the restatement on the Sector Statement of Income (in millions, except per share amounts):

	Third Quarter 2005						First Nine Months 2005
	Previously Reported			Restated			Previously Reported			Restated
	(unaudited)						(unaudited)
AUTOMOTIVE
Sales	$	34,675		$	34,656		$	112,692		$	112,778
Costs and expenses
Cost of sales		33,532			33,471			105,803			105,786
Selling, administrative and other expenses		2,811			2,811			8,996			8,977
Total costs and expenses		36,343			36,282			114,799			114,763
Operating income/(loss)		(1,668	)		(1,626	)		(2,107	)		(1,985	)

Interest expense		371			371			960			960

Interest income and other non-operating income/(expense), net		307			307			1,111			1,111
Equity in net income/(loss) of affiliated companies		133			133			259			259
Income/(loss) before income taxes — Automotive		(1,599	)		(1,557	)		(1,697	)		(1,575	)

FINANCIAL SERVICES
Revenues		6,181			5,854			17,848			17,793
Costs and expenses
Interest expense		1,605			1,786			4,699			5,327
Depreciation		1,537			1,537			4,591			4,591
Operating and other expenses		1,635			1,635			4,613			4,613
Provision for credit and insurance losses		182			182			350			350
Total costs and expenses		4,959			5,140			14,253			14,881
Income/(loss) before income taxes — Financial Services		1,222			714			3,595			2,912

TOTAL COMPANY
Income/(loss) before income taxes		(377	)		(843	)		1,898			1,337
Provision for/(benefit from) income taxes		(140	)		(314	)		(127	)		(328	)
Income/(loss) before minority interests		(237	)		(529	)		2,025			1,665
Minority interests in net income/(loss) of subsidiaries		54			54			196			196
Income/(loss) from continuing operations		(291	)		(583	)		1,829			1,469
Income/(loss) from discontinued operations (Note 4)		7			7			45			45
Net income/(loss)	$	(284	)	$	(576	)	$	1,874		$	1,514

AMOUNTS PER SHARE OF COMMON AND CLASS B STOCK (Note 12)
Basic income/(loss)
Income/(loss) from continuing operations	$	(0.16	)	$	(0.31	)	$	0.99		$	0.80
Income/(loss) from discontinued operations		0.01			—			0.03			0.02
Net income/(loss)	$	(0.15	)	$	(0.31	)	$	1.02		$	0.82
Diluted income/(loss)
Income/(loss) from continuing operations	$	(0.16	)	$	(0.31	)	$	0.93		$	0.76
Income/(loss) from discontinued operations		0.01			—			0.02			0.03
Net income/(loss)	$	(0.15	)	$	(0.31	)	$	0.95		$	0.79
Cash dividends	$	0.10		$	0.10		$	0.30		$	0.30

Item 1. Financial Statements (Continued)

NOTE 2. RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Continued)

The following table presents the effect of the restatement on the Consolidated Balance Sheet at December 31, 2005 (in millions):

	Previously Reported			Restated
ASSETS
Cash and cash equivalents	$	28,406		$	28,406
Marketable securities		10,672			10,672
Loaned securities		3,461			3,461
Finance receivables, net		105,975			105,975
Other receivables, net		8,522			8,536
Net investment in operating leases		27,099			27,099
Retained interest in sold receivables		1,420			1,420
Inventories (Note 6)		10,271			10,271
Equity in net assets of affiliated companies		2,579			2,579
Net property		40,706			40,676
Deferred income taxes		5,881			5,880
Goodwill and other intangible assets (Note 9)		5,945			5,945
Assets of discontinued/held-for-sale operations		5			5
Other assets		18,534			18,534
Total assets	$	269,476		$	269,459

LIABILITIES AND STOCKHOLDERS’ EQUITY
Payables	$	22,813		$	22,910
Accrued liabilities and deferred revenue		72,977			73,047
Debt		154,332			153,278
Deferred income taxes		5,275			5,660
Total liabilities		255,397			254,895

Minority interests		1,122			1,122

Stockholders’ equity
Capital stock
Common Stock, par value $0.01 per share (1,837 million shares issued)		18			18
Class B Stock, par value $0.01 per share (71 million shares issued)		1			1
Capital in excess of par value of stock		4,872			4,872
Accumulated other comprehensive income/(loss)		(3,562	)		(3,680	)
Treasury stock		(833	)		(833	)
Retained earnings		12,461			13,064
Total stockholders’ equity		12,957			13,442
Total liabilities and stockholders’ equity	$	269,476		$	269,459

Item 1. Financial Statements (Continued)

NOTE 2. RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Continued)

The following table presents the effect of the restatement on the Sector Balance Sheet at December 31, 2005 (in millions):

	Previously Reported			Restated
ASSETS
Automotive
Cash and cash equivalents	$	13,388		$	13,388
Marketable securities		6,860			6,860
Loaned securities		3,461			3,461
Total cash, marketable and loaned securities		23,709			23,709
Receivables, net		3,061			3,075
Inventories (Note 6)		10,271			10,271
Deferred income taxes		1,187			1,249
Other current assets		8,177			8,177
Total current assets		46,405			46,481
Equity in net assets of affiliated companies		1,756			1,756
Net property		40,378			40,348
Deferred income taxes		11,049			10,999
Goodwill and other intangible assets (Note 9)		5,928			5,928
Assets of discontinued/held-for-sale operations		5			5
Other assets		8,308			8,308
Total Automotive assets		113,829			113,825
Financial Services
Cash and cash equivalents		15,018			15,018
Marketable securities		3,812			3,812
Finance receivables, net		111,436			111,436
Net investment in operating leases		22,951			22,951
Retained interest in sold receivables		1,420			1,420
Goodwill and other intangible assets (Note 9)		17			17
Other assets		7,457			7,457
Receivable from Automotive		83			83
Total Financial Services assets		162,194			162,194
Intersector elimination		(83	)		(83	)
Total assets	$	275,940		$	275,936

LIABILITIES AND STOCKHOLDERS’ EQUITY
Automotive
Trade payables	$	16,554		$	16,637
Other payables		4,222			4,222
Accrued liabilities and deferred revenue		28,733			28,829
Deferred income taxes		804			804
Debt payable within one year		978			978
Current payable to Financial Services		83			83
Total current liabilities		51,374			51,553
Long-term debt		16,900			16,900
Other liabilities		38,639			38,639
Deferred income taxes		586			586
Non-current payable to Financial Services		—			—
Total Automotive liabilities		107,499			107,678
Financial Services
Payables		2,037			2,051
Debt		136,454			135,400
Deferred income taxes		10,349			10,747
Other liabilities and deferred income		5,605			5,579
Total Financial Services liabilities		154,445			153,777

Minority interests		1,122			1,122

Stockholders’ equity
Capital stock
Common Stock, par value $0.01 per share (1,837 million shares issued)		18			18
Class B Stock, par value $0.01 per share (71 million shares issued)		1			1
Capital in excess of par value of stock		4,872			4,872
Accumulated other comprehensive income/(loss)		(3,562	)		(3,680	)
Treasury stock		(833	)		(833	)
Retained earnings		12,461			13,064
Total stockholders’ equity		12,957			13,442
Intersector elimination		(83	)		(83	)
Total liabilities and stockholders’ equity	$	275,940		$	275,936

Item 1. Financial Statements (Continued)

NOTE 2. RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Continued)

The following table presents the effect of the restatement on the Condensed Consolidated Statement of Cash Flows for the period ended September 30, 2005 (in millions):

	First Nine Months 2005
	Previously Reported			Restated
	(unaudited)

Cash flows from operating activities of continuing operations
Net cash (used in)/provided by operating activities	$	20,103		$	19,282

Cash flows from investing activities of continuing operations
Capital expenditures		(5,462	)		(5,462	)
Acquisitions of retail and other finance receivables and operating leases		(42,026	)		(42,026	)
Collections of retail and other finance receivables and operating leases		37,760			36,492
Net acquisitions of daily rental vehicles		(2,775	)		(2,183	)
Purchases of securities		(4,743	)		(10,100	)
Sales and maturities of securities		3,863			4,197
Proceeds from sales of retail and other finance receivables and operating leases		15,144			15,144
Proceeds from sale of businesses		2,245			2,245
Cash paid for acquisitions		(1,617	)		(1,617	)
Transfer of cash balances upon disposition of discontinued/held-for-sale operations		—			(4	)
Other		576			2,229
Net cash (used in)/provided by investing activities		2,965			(1,085	)

Cash flows from financing activities of continuing operations
Cash dividends		(552	)		(552	)
Sales of Common Stock		697			697
Purchases of Common Stock		(447	)		(447	)
Changes in short-term debt		(6,177	)		(6,234	)
Proceeds from issuance of other debt		20,237			21,677
Principal payments on other debt		(31,076	)		(32,516	)
Other		(5	)		(28	)
Net cash (used in)/provided by financing activities		(17,323	)		(17,403	)

Effect of exchange rate changes on cash		(376	)		(376	)

Net increase/(decrease) in cash and cash equivalents from continuing operations		5,369			418

Cash flows from discontinued operations
Cash flows from operating activities of discontinued operations		—			65
Cash flows from investing activities of discontinued operations		—			(50	)
Cash flows from financing activities of discontinued operations		—			—

Net increase/(decrease) in cash and cash equivalents	$	—		$	433

Cash and cash equivalents at January 1	$	22,831		$	22,828
Cash and cash equivalents of discontinued/held-for-sale operations at January 1		—			681
Net increase/(decrease) in cash and cash equivalents		5,369			433
Less: cash and cash equivalents of discontinued/held-for-sale operations at September 30		—			(790	)
Cash and cash equivalents at September 30	$	28,200		$	23,152

Item 1. Financial Statements (Continued)

NOTE 2. RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Continued)

The following table presents the effect of the restatement on the Condensed Sector Statement of Cash Flows for the period ended September 30, 2005 (in millions):

	Previously Reported						Restated
	First Nine Months 2005						First Nine Months 2005
	Automotive			Financial Services			Automotive			Financial Services
	(unaudited)						(unaudited)
Cash flows from operating activities of continuing operations
Net cash (used in)/provided by operating activities	$	4,535		$	7,757		$	4,532		$	5,887

Cash flows from investing activities
Capital expenditures		(5,109	)		(353	)		(5,109	)		(353	)
Acquisitions of retail and other finance receivables and operating leases		—			(42,026	)		—			(42,026	)
Collections of retail and other finance receivables and operating leases		—			36,560			—			36,579
Net (increase)/decrease of wholesale receivables		—			5,272			—			5,629
Net acquisitions of daily rental vehicles		—			(2,775	)		—			(2,775	)
Purchases of securities		(4,343	)		(400	)		(4,343	)		(5,757	)
Sales and maturities of securities		3,239			624			3,239			958
Proceeds from sales of retail and other finance receivables and operating leases		—			15,144			—			15,144
Proceeds from sales of wholesale receivables		—			3,739			—			3,739
Proceeds from sale of businesses		204			2,041			204			2,041
Transfer of cash balances upon disposition of discontinued/held-for-sale operations		—			—			1			(5	)
Investing activity from Financial Services		2,486			—			2,486			—
Investing activity to Financial Services		—			—			—			—
Cash paid for acquisitions		(1,617	)		—			(1,617	)		—
Other		451			125			453			1,776
Net cash (used in)/provided by investing activities		(4,689	)		17,951			(4,686	)		14,950

Cash flows from financing activities
Cash dividends		(552	)		—			(552	)		—
Sales of Common Stock		697			—			697			—
Purchases of Common Stock		(447	)		—			(447	)		—
Changes in short-term debt		(3	)		(6,174	)		(3	)		(6,231	)
Proceeds from issuance of other debt		253			19,984			253			21,424
Principal payments on other debt		(682	)		(30,394	)		(682	)		(31,834	)
Financing activity from Automotive		—			—			—			—
Financing activity to Automotive		—			(2,486	)		—			(2,486	)
Other		(4	)		(1	)		(4	)		(24	)
Net cash (used in)/provided by financing activities		(738	)		(19,071	)		(738	)		(19,151	)

Effect of exchange rate changes on cash		14			(390	)		14			(390	)
Net change in intersector receivables/payables and other liabilities		(168	)		168			(168	)		168
Net increase/(decrease) in cash and cash equivalents from continuing operations		(1,046	)		6,415			(1,046	)		1,464

Cash flows from discontinued operations
Cash flows from operating activities of discontinued operations		—			—			(6	)		71
Cash flows from investing activities of discontinued operations		—			—			16			(66	)
Cash flows from financing activities of discontinued operations		—			—			—			—

Net increase/(decrease) in cash and cash equivalents	$	(1,046	)	$	6,415		$	(1,036	)	$	1,469

Cash and cash equivalents at January 1	$	10,142		$	12,689		$	10,139		$	12,689
Cash and cash equivalents of discontinued/held-for-sale operations at January 1		—			—			2			679
Net increase/(decrease) in cash and cash equivalents		(1,046	)		6,415			(1,036	)		1,469
Less: cash and cash equivalents of discontinued/held-for-sale operations at September 30		—			—			(13	)		(777	)
Cash and cash equivalents at September 30	$	9,096		$	19,104		$	9,092		$	14,060

Item 1. Financial Statements (Continued)

NOTE 3. INCOME TAXES

For the first nine months of the year, we have used the actual effective tax rate for the year-to-date tax provision calculation because a reliable estimate of the full-year effective tax rate cannot be made. External business conditions and other factors throughout the year may contribute to significant variability of the effective tax rate due to the impact of permanent differences relative to our financial results. Effective this quarter, the balance of deferred taxes primarily at our Ford North America and Jaguar/Land Rover operations has changed from a net deferred tax liability position to a net deferred tax asset position. Due to the cumulative losses we have incurred at these operations and their near-term financial outlook, we recorded a valuation allowance of $1.8 billion against the net deferred tax asset in the third quarter of 2006. Detailed valuation allowance testing was conducted for each legal entity and tax jurisdiction in which these operations conduct business. The effective tax rates of 18.0% for the third quarter and 25.7% for the first nine months include the impact of this valuation allowance.

In the third quarter of 2006, we reflected the favorable effects related to the settlement of prior-year federal and state tax matters of about $400 million in our Automotive interest expense , which more than offsets the interest expense that we normally carry.

NOTE 4. DISCONTINUED OPERATIONS AND OTHER DISPOSITIONS

Total Company Discontinued Operations

The results of all discontinued operations are as follows (in millions):

	Third Quarter					First Nine Months
	2006		2005			2006			2005
Sales and revenues	$	—	$	1		$	—		$	121

Operating income/(loss) from discontinued operations	$	—	$	—		$	—		$	54
Gain/(loss) on discontinued operations		—		11			3			(5	)
(Provision for)/benefit from income taxes		—		(4	)		(1	)		(4	)
Income/(loss) from discontinued operations	$	—	$	7		$	2		$	45

NOTE 5. EXIT AND DISPOSAL ACTIVITIES AND OTHER ACTIONS

General

The timing for recording expenses related to employee separation actions differs by type of separation program: the cost of certain benefits for hourly employees associated with facilities that are being idled through 2008 is being expensed when it is probable the employees will be permanently idled; the cost of other voluntary employee separation actions is being recorded as an expense at the time an employee accepts a separation offer.

Jobs Bank Benefits Reserve

On January 23, 2006, we announced a major business improvement plan for our North American Automotive operations, which we refer to as the Way Forward plan. As part of this plan, we announced that the following facilities will be idled through 2008: St. Louis Assembly Plant, Atlanta Assembly Plant, Wixom Assembly Plant, Batavia Transmission Plant, Windsor Casting Plant, Twin Cities Assembly Plant, and Norfolk Assembly Plant. In addition, we announced that production at our St. Thomas Assembly Plant in Canada would be reduced to one shift.

Responding to changing business circumstances, on September 15, 2006, Ford announced an acceleration of this plan, pursuant to which two additional facilities would be idled through 2008: Maumee (Ohio) Stamping Plant and Essex (Ontario, Canada) Engine Plant. We also announced that the Norfolk Assembly Plant would be idled a year earlier than planned, and that a shift reduction is now planned at Norfolk and Twin Cities Assembly in advance of the idling of the facilities. In addition, we announced that all Automotive Components Holdings, LLC ("ACH") operations would be sold or closed by the end of 2008.

Hourly employees working at the U.S. plants identified above are represented by the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America ("UAW"); hourly employees working at the Canadian plants identified above are represented by the National Automobile, Aerospace, Transportation and General Workers Union of Canada ("CAW"). The collective bargaining agreement between us and the UAW contains

Item 1. Financial Statements (Continued)

NOTE 5. EXIT AND DISPOSAL ACTIVITIES AND OTHER ACTIONS (Continued)

a guaranteed employment numbers provision, pursuant to which we are required to pay idled employees who meet certain conditions substantially all of their wages and benefits for the term of the current agreement; the collective bargaining agreement between us and the CAW contains provisions pursuant to which we are required to pay idled employees a portion of their wages and certain benefits for a specified period of time based on the number of credits an employee has received. We refer to these benefits under the UAW and CAW agreements as "Jobs Bank Benefits."

The plant idlings and shift reductions described above are expected to create a population of hourly employees covered under the UAW and CAW collective bargaining agreements who will be permanently idled because we do not have the ability or intent to redeploy or absorb them in our operations. The employee-related costs associated with these actions have been expensed and include an amount for Jobs Bank Benefits expected to be provided in their present form under the current UAW and CAW collective bargaining agreements, which are scheduled to expire in September 2007 and September 2008, respectively, and an amount for Jobs Bank Benefits or similar benefits in an expected modified form under new collective bargaining agreements after expiration of the current agreements. The reserve balance is adjusted for Jobs Bank Benefits payments made to employees. In addition, the reserve is adjusted when we offer voluntary separation and/or relocation packages to employees which are accepted and whose cost can be reasonably estimated. Approximately 5,700 (of the approximately 25,000 affected employees at the announced Ford plants and ACH) have accepted voluntary separation packages or have agreed to relocate to other facilities as of September 30, 2006.

The reserve balance at September 30, 2006 was $2.0 billion, and represents our best estimate of the liability for approximately 17,200 UAW-represented employees (including ACH) and 2,200 CAW-represented employees remaining at the facilities identified above, considering several factors: the demographics of the population at each affected facility, redeployment alternatives, recent experience relative to voluntary redeployments, and recent experience with regard to the rate of voluntary separations. However, because of the complexities inherent in estimating this reserve, our actual costs could differ materially. Accordingly, we will continue to review our expected liability and make adjustments as necessary. We continue to expense costs as incurred associated with the small number of employees who are temporarily idled.

With respect to the remaining manufacturing facilities included in our Way Forward plan announcement, we have not accrued any costs for benefits that may be provided to employees working at facilities to be idled after 2008. The cost of executing the plans for these facilities is dependent on the resolution of many contingencies, including the negotiation of future labor agreements, the successful implementation of our product cycle plan, the resolution of alternative capacity actions, and changes in our market share between now and the planned idling of those facilities. Our present estimate for benefits that we anticipate may be paid to employees expected to be permanently idled at the remaining manufacturing facilities as part of our accelerated Way Forward plan is a charge of up to $750 million (on a discounted basis). Although it is probable that we will take the necessary actions to reduce our manufacturing employment, the amount of our estimated benefit obligation is highly dependent on the resolution of the previously-mentioned contingencies. No estimated value is more likely than another, and therefore, the benefit obligation is not reasonably estimable.

Other Actions

UAW Voluntary Separations: During the first nine months of 2006, we reduced our hourly workforce in U.S. plants other than those identified above by approximately 3,500 employees and recognized a $200 million pre-tax charge related to these separations. During the third quarter, we announced that we will offer early retirement and voluntary separation programs to all Ford and ACH hourly employees in the United States as part of our accelerated Way Forward plan. These programs will be offered in the fourth quarter of 2006. Hourly employees who accept an early retirement or separation offer are expected to leave the company by September 2007.

Other Employee Separation Actions: We also announced during the third quarter of 2006 our plans to reduce the North American salaried-related costs through the elimination of the equivalent of about 14,000 positions (which includes the equivalent of 4,000 positions already eliminated in the first quarter of 2006). Most salaried reductions are expected to be completed by the end of the first quarter of 2007, and will be achieved through early retirements, voluntary separations, and if necessary, involuntary separations. Most of these costs will be incurred in the fourth quarter of 2006 and the first quarter of 2007, as employees accept these offers.

During the third quarter of 2005, Premier Automotive Group ("PAG") and Ford Europe initiated hourly and salaried employee separation actions resulting in pre-tax charges of $117 million and $26 million in the first nine months of 2006 and 2005, respectively.

Item 1. Financial Statements (Continued)

NOTE 5. EXIT AND DISPOSAL ACTIVITIES AND OTHER ACTIONS (Continued)

All charges disclosed above exclude costs for pension and other postretirement employee benefits ("OPEB"). For further discussion regarding pension and OPEB, see Note 14 of the Notes to the Financial Statements.

NOTE 6. AUTOMOTIVE INVENTORIES

Inventories are summarized as follows (in millions):

	September 30,			December 31,
	2006			2005
Raw materials, work-in-process and supplies	$	4,683		$	4,057
Finished products		8,343			7,223
Total inventories at FIFO		13,026			11,280
Less: LIFO adjustment		(1,029	)		(1,009	)
Total inventories	$	11,997		$	10,271

During 2006, inventory quantities were reduced, resulting in a liquidation of LIFO inventory quantities carried at lower costs prevailing in prior years as compared with the cost of 2006 purchases, the effect of which decreased cost of goods sold by approximately $4 million.

NOTE 7. NET PROPERTY

Beginning January 1, 2006, we changed our method of amortization for special tools from an activity-based method (units-of-production) to a time-based method. The time-based method amortizes the cost of special tools over their expected useful lives using a straight-line method or, if the production volumes for major product programs associated with the tool are expected to materially decline over the life of the tool, an accelerated method reflecting the rate of decline. For the third quarter of 2006, this change increased Cost of sales by $1 million, and decreased Income/(loss) from continuing operations and Net income by $1 million, with no impact on earnings per share. For the first nine months of 2006, the change decreased Cost of sales by $133 million, and increased Income/(loss) from continuing operations and Net income by $133 million or $0.07 per diluted share.

NOTE 8. IMPAIRMENT OF LONG-LIVED ASSETS

Based on the assumptions underlying our accelerated Way Forward plan, we project a decline in net cash flows for the Ford North America segment, primarily reflecting lower market share assumptions, lower production, and other aspects of our accelerated plan. As a result, in the third quarter of 2006 we tested the long-lived assets of this segment for recoverability and recorded a pre-tax impairment charge of $2.2 billion in Cost of sales , representing the amount by which the carrying value of these assets exceeded the fair value.

During the third quarter of 2006, we also reviewed our business plan for the Jaguar/Land Rover operating unit within our PAG segment and, consistent with 2006 operating results, are projecting lower sales, a decline in net cash flows for this operating unit based on cost performance shortfalls and currency exchange deterioration. As a result, we tested the long-lived assets of this operating unit for recoverability and recorded a pre-tax impairment charge of $1.6 billion in Cost of sales , representing the amount by which the carrying value of these assets exceeded the fair value.

The fair value of the asset groups were measured using the discounted cash flow projections approved by our Board of Directors. We also compared various market multiples (e.g., revenue and EBITDA) within the same industry as useful comparative data points.

NOTE 9. GOODWILL AND OTHER INTANGIBLES

Beginning in 2006, our policy is to perform annual testing of goodwill and certain other intangible assets during the fourth quarter to determine whether any impairment has occurred. Testing is conducted at the reporting unit level. Testing is also performed following a triggering event for the long-lived asset impairment test. As a result of the impairment of Ford North America and Jaguar/Land Rover operating units, we tested goodwill at our Ford North America and PAG reporting units. No goodwill impairment was necessary.

Item 1. Financial Statements (Continued)

NOTE 9. GOODWILL AND OTHER INTANGIBLES (Continued)

To test for impairment, the carrying value of each reporting unit is compared with its fair value. Fair value is estimated using the present value of free cash flows method. Prior to 2006, our policy was to test in the second quarter; in 2005, we tested in both the second and fourth quarters. Fourth quarter testing is considered preferable because it allows us to use more current financial information and matches our business plan timing. This change in accounting principle does not delay, accelerate or avoid an impairment charge or affect our financial statements.

Changes in the carrying amount of goodwill are as follows (in millions):

	Goodwill, December 31, 2005		Goodwill Acquired		Goodwill Impaired		Exchange Translation/ Other		Goodwill, September 30, 2006
Automotive Sector:
Ford North America	$	202	$	2	$	—	$	—	$	204
Ford South America		—		—		—		—		—
Ford Europe		31		—		—		2		33
PAG		4,875		—		—		406		5,281
Ford Asia Pacific and Africa		—		—		—		—		—
Total Automotive Sector		5,108		2		—		408		5,518
Financial Services Sector:
Ford Credit		17		—		—		—		17
Total Financial Services Sector		17		—		—		—		17
Total	$	5,125	$	2	$	—	$	408	$	5,535

In addition to the goodwill presented in the above table, included within Equity in net assets of affiliated companies was goodwill of $249 million at September 30, 2006. This included an increase of $36 million related to the conversion of our investment in Mazda Motor Corporation ("Mazda") convertible bonds to an investment in Mazda's equity.

The components of identifiable intangible assets are as follows (in millions):

	September 30, 2006							December 31, 2005
	Gross Carrying Amount		Less: Accumulated Depreciation			Net Intangible Assets		Gross Carrying Amount		Less: Accumulated Depreciation			Net Intangible Assets
Automotive Sector:
Tradename	$	467	$	—		$	467	$	431	$	—		$	431
Distribution Networks		354		(91	)		263		337		(83	)		254
Other		237		(106	)		131		221		(86	)		135
Total Automotive Sector		1,058		(197	)		861		989		(169	)		820
Total Financial Services Sector		4		(4	)		—		4		(4	)		—
Total	$	1,062	$	(201	)	$	861	$	993	$	(173	)	$	820

The intangibles account is comprised of a non-amortizable tradename, distribution networks with a useful life of 40 years and other intangibles with various amortization periods (primarily patents, customer contracts, technology, and land rights). Pre-tax amortization expense related to these intangible assets for the first nine months of 2006 and 2005 was $19 million and $41 million, respectively. Intangible asset amortization is forecasted to range from $20 million to $30 million per year for the next five years, excluding the impact of foreign currency translation.

NOTE 10. VARIABLE INTEREST ENTITIES

We consolidate VIEs of which we are the primary beneficiary. The liabilities recognized as a result of consolidating these VIEs do not represent additional claims on our general assets; rather, they represent claims against the specific assets of the consolidated VIEs. Conversely, assets recognized as a result of consolidating these VIEs do not represent additional assets that could be used to satisfy claims against our general assets. Reflected in our September 30, 2006 balance sheet are consolidated VIE assets of $5.3 billion for the Automotive sector and $55.7 billion for the Financial Services sector. Included in Automotive consolidated VIE assets are $382 million of cash and cash equivalents. For the Financial Services sector, consolidated VIE assets include $6.7 billion in cash and cash equivalents, and $49 billion of finance receivables.

Item 1. Financial Statements (Continued)

NOTE 10. VARIABLE INTEREST ENTITIES (Continued)

We have several investments in other entities determined to be VIEs of which we are not the primary beneficiary. The risks and rewards associated with our interests in these entities are based primarily on ownership percentages. Our maximum exposure is $285 million for the Automotive sector and $196 million for the Financial Services sector at September 30, 2006. Any potential losses associated with these VIEs, should they occur, is limited to the value of our invested capital or equity rights and, where applicable, receivables due from the VIEs.

Ford Credit also sells finance receivables to bank-sponsored asset-backed commercial paper issuers that are special purpose entities ("SPEs") of the sponsor bank; these SPEs are not consolidated by us. The outstanding balance of finance receivables that have been sold by Ford Credit to these SPEs was approximately $4.6 billion at September 30, 2006.

NOTE 11. DERIVATIVE FINANCIAL INSTRUMENTS

All derivative instruments, including embedded derivatives, are recorded at fair market value on our balance sheet.

Income Statement Impact: The ineffective portion of designated hedges and mark-to-market adjustments for non-designated hedging activity are recognized in Cost of sales or Interest income and other non-operating income/(expense), net for the Automotive sector and in Revenues for the Financial Services sector.

Fair Value of Derivative Instruments: The fair value of derivatives reflects the price that a third party would be willing to pay or receive in arm’s-length transactions for these derivatives, and includes mark-to-market adjustments to reflect the effects of changes in the related index. The following table summarizes the estimated fair value of our derivative financial instruments, taking into consideration the effects of legally enforceable netting agreements (in millions):

	September 30, 2006						December 31, 2005
	Fair Value Assets			Fair Value Liabilities			Fair Value Assets			Fair Value Liabilities
Automotive Sector
Foreign currency forwards and options	$	1,049		$	752		$	747		$	1,168
Commodity forwards and options		939			57			703			38
Other		142			1			128			1
Total derivative financial instruments	$	2,130		$	810		$	1,578		$	1,207
Financial Services Sector
Foreign currency swaps, forwards, and options	$	879		$	461		$	1,126		$	789
Interest rate swaps		1,104			47			1,657			96
Impact of netting agreements		(234	)		(234	)		(205	)		(205	)
Total derivative financial instruments	$	1,749		$	274		$	2,578		$	680

Item 1. Financial Statements (Continued)

NOTE 12. AMOUNTS PER SHARE OF COMMON AND CLASS B STOCK

The calculation of diluted income per share of Common and Class B Stock takes into account the effect of obligations, such as stock options and convertible securities, considered to be potentially dilutive. Basic and diluted income/(loss) per share were calculated using the following (in millions):

	Third Quarter								First Nine Months
	2006				2005				2006				2005
Basic and Diluted Income/(Loss)
Basic income/(loss) from continuing operations	$	(5,248	)		$	(583	)		$	(6,990	)		$	1,469
Effect of dilutive convertible preferred securities		—		(a)		—		(a)		—		(a)		160
Diluted income/(loss) from continuing operations	$	(5,248	)		$	(583	)		$	(6,990	)		$	1,629

Basic and Diluted Shares
Average shares outstanding		1,883				1,853				1,875				1,842
Restricted and uncommitted-ESOP shares		(1	)			(2	)			(2	)			(3	)
Basic shares		1,882				1,851				1,873				1,839
Net dilutive options and restricted and uncommitted-ESOP shares		—		(b)		—		(b)		—		(b)		10
Dilutive convertible preferred securities		—		(a)		—		(a)		—		(a)		282
Diluted shares		1,882				1,851				1,873				2,131

__________

Not included in calculation of diluted earnings per share due to their antidilutive effect:

(a)

282 million shares and the related income effect for convertible preferred securities.

(b)

3 million, 8 million, and 4 million contingently issuable shares for third quarter 2006, third quarter 2005, and first nine months 2006, respectively.

NOTE 13. COMPREHENSIVE INCOME/(LOSS)

Total comprehensive income/(loss) is summarized as follows (in millions):

	Third Quarter						First Nine Months
	2006			2005			2006			2005
Net income/(loss)	$	(5,248	)	$	(576	)	$	(6,988	)	$	1,514
Other comprehensive income/(loss)
Foreign currency translation		36			204			1,503			(2,755	)
Minimum pension liability		(9	)		16			1,137			117
Net income/(loss) on derivative instruments		(431	)		(58	)		249			(1,021	)
Net holding gain/(loss)		22			(39	)		6			(51	)
Total other comprehensive income/(loss)		(382	)		123			2,895			(3,710	)
Total comprehensive income/(loss)	$	(5,630	)	$	(453	)	$	(4,093	)	$	(2,196	)

Item 1. Financial Statements (Continued)

NOTE 14. RETIREMENT BENEFITS

Pension, postretirement health care and life insurance benefit expense is summarized as follows (in millions):

	Third Quarter
	Pension Benefits												Health Care and
	U.S. Plans						Non-U.S. Plans						Life Insurance
	2006			2005			2006			2005			2006			2005
Service cost	$	162		$	184		$	180		$	152		$	136		$	178
Interest cost		620			601			359			340			470			551
Expected return on assets		(847	)		(847	)		(424	)		(400	)		(128	)		(126	)
Amortization of:
Prior service costs		111			125			32			30			(233	)		(54	)
(Gains)/losses and other		22			26			148			89			161			223
Separation programs		44			42			50			40			13			—
Loss from curtailment		258			—			179			—			1			—
Costs allocated to Visteon		—			(28	)		—			—			2			(80	)
Net expense	$	370		$	103		$	524		$	251		$	422		$	692

	First Nine Months
	Pension Benefits												Health Care and
	U.S. Plans						Non-U.S. Plans						Life Insurance
	2006			2005			2006			2005			2006			2005
Service cost	$	516		$	553		$	522		$	478		$	513		$	534
Interest cost		1,809			1,799			1,037			1,064			1,565			1,653
Expected return on assets		(2,523	)		(2,516	)		(1,219	)		(1,236	)		(386	)		(374	)
Amortization of:
Prior service costs		344			377			92			92			(553	)		(162	)
(Gains)/losses and other		81			77			417			261			619			670
Separation programs		64			67			84			57			13			—
Loss from curtailment		1,161			—			179			—			3			—
Costs allocated to Visteon		—			(84	)		—			—			4			(242	)
Net expense	$	1,452		$	273		$	1,112		$	716		$	1,778		$	2,079

In the first half of 2006, we recorded a $903 million pension curtailment loss associated with employees to be permanently idled at announced facilities as well as with additional employee separations related to the Way Forward plan. In the third quarter of 2006, we recorded an additional $437 million pension curtailment loss associated with employee actions to be taken under our accelerated Way Forward plan.

The weighted average discount rate assumption used at September 30, 2006 to determine the U.S. pension obligation was 5.88%.

At September 30, 2006, our retiree Voluntary Employee Benefit Association trust ("VEBA") contained $5.1 billion of assets. This retiree VEBA balance reflects our transfer during the third quarter of $1.3 billion from our retiree VEBA to Automotive cash as reimbursement for hourly retiree health care and life insurance payments. Of the $5.1 billion of assets in our retiree VEBA, $1.8 billion was invested on a long-term basis consistent with our pension asset investments at September 30, 2006. The expected return assumption applicable to these assets invested consistent with our pension asset investments was 8.5% at September 30, 2006.

At September 30, 2006, we had $3.3 billion invested in shorter-duration fixed income investments, for which the expected return assumption was 5.5%. Of this $3.3 billion invested in shorter-duration fixed income investments, $1.7 billion was able to be used within the next 18 months to pay for retiree benefits ("short-term VEBA"). Our current strategy is to invest all of the assets of our retiree VEBA in shorter-duration fixed income investments, a move we plan to complete during the fourth quarter. Consistent with our standard practice, we will continue to include in Automotive gross cash our short-term VEBA. We refer to retiree VEBA assets that are not able to be used within the next 18 months to pay for retiree benefits as "long-term VEBA."

Item 1. Financial Statements (Continued)

NOTE 14. RETIREMENT BENEFITS (Continued)

Company Contributions

Our policy for funded plans is to contribute annually, at a minimum, amounts required by applicable laws, regulations, and union agreements. From time to time, we make contributions beyond those legally required.

Pension: In the first nine months of 2006, we contributed $900 million to our worldwide pension plans, including benefit payments paid directly by the Company for unfunded plans. We expect to contribute from Automotive cash and cash equivalents an additional $500 million in 2006, for a total of $1.4 billion this year. Based on current assumptions and regulations, we do not expect to have a legal requirement to fund our major U.S. pension plans in 2006.

UAW Agreement

As previously reported, we entered into an agreement with the UAW ("Agreement") in December 2005 to increase retiree health care cost sharing as part of our overall cost reduction efforts. Our decision to modify the retiree health care plan was challenged in court, so that implementation of the Agreement required court approval of a proposed settlement of the legal challenge. On July 13, 2006, we received the necessary court approval and cost savings began to accrue as of that date. The Agreement provides for increased cost sharing of health care expenses by retirees presently covered under the Hospital-Surgical-Medical-Drug-Dental-Vision Program ("H-S-M-D-D-V Program") ("Plan Amendment") and establishes an independent Defined Contribution Retiree Health Benefit Trust ("UAW Benefit Trust") which will serve as a non-Ford sponsored Voluntary Employee Benefit Association. The UAW Benefit Trust will be used to mitigate the reduction in health plan benefits for certain eligible present and future retirees, surviving spouses and other dependents. This settlement agreement will remain in effect until September 14, 2011, at which point either Ford or the UAW may provide notice of a desire to terminate the Agreement.

The Agreement provisions reduce significantly our share of health care costs. The Agreement has been accounted for as a negative amendment to the H-S-M-D-D-V Program in the amount of $4 billion, net of $90 million representing the present value of our commitment to fund the UAW Benefit Trust discounted at 6.5%. We will amortize the negative plan amendment on a straight-line basis over 12 years (which represents the average remaining service period of our active workforce). In addition we will accrete interest expense on the discounted value of the funding commitment noted above. The interest expense recorded for the third quarter was $1 million.

As part of the Agreement, we committed to make three non-contingent cash payments ("buy-down") to the UAW Benefit Trust totaling $108 million. We transferred the first installment of $30 million in cash to the UAW Benefit Trust on August 10, 2006. We have also committed to make a second contribution of $35 million in 2009, and a third contribution of $43 million in 2011.

The UAW Benefit Trust is controlled by the UAW Benefit Association Plan Committee ("Committee") which is appointed by the UAW. The Committee does not and will not include any representatives of the Company. The Committee has the right to appoint an independent trustee ("Trustee") for purposes of managing the assets. The assets of the UAW Benefit Trust are the responsibility of the Committee, which has full fiduciary responsibility for the investment strategy, safeguarding of assets, and execution of the benefit plan as designed. Benefit payments to eligible participants in the UAW Benefit Trust are limited in amount to the assets held by the UAW Benefit Trust. Each year, the Committee will determine the level of benefits to be paid to eligible participants. If the value of the assets in the UAW Benefit Trust is deemed insufficient by the Trustee, the Trustee may accelerate our obligation for the second and third contribution to the extent necessary to enable the UAW Benefit Trust to continue paying benefits.

As part of the Agreement, we also agreed to transfer to the UAW Benefit Trust the right to an amount of cash determined by the appreciation of 8.75 million shares of Ford Common Stock above $8.145 per share. These stock appreciation rights are exercisable for three years from the effective date of the Plan Amendment. One third of the 8.75 million stock appreciation rights were granted on July 13, 2006. As of September 30, 2006, these stock appreciation rights had not been exercised. On the first anniversary of the effective date of the Agreement, another third of the 8.75 million stock appreciation rights will become available and on the second anniversary, the remaining stock appreciation rights will become available. We use a Black-Scholes model to measure the fair value of the stock appreciation rights on a graded vesting schedule. We expensed $8 million related to the stock appreciation rights in the third quarter, recorded in Automotive cost of sales .

As part of the Agreement, UAW members also agreed to divert to the UAW Benefit Trust payments of a previously-negotiated 2006 wage increase and a portion of negotiated cost-of-living increases through 2011 as they are earned. In the third quarter, $4 million of diverted wage increases were expensed.

Item 1. Financial Statements (Continued)

NOTE 14. RETIREMENT BENEFITS (Continued)

The average annual cost savings to Ford from the plan amendment is projected to be $650 million, with projected average annual cash savings of $200 million. The cost savings associated with the amendment for 2006 is approximately $300 million. The agreement with the UAW constitutes a significant plan amendment. Accordingly, we remeasured the hourly H-S-M-D-D-V Program liability as of July 13, 2006. The Plan Amendment, together with the plan remeasurement reflecting a higher discount rate and recent health care claims experience, reduced our OPEB obligation by approximately $9 billion.

The weighted average discount rate assumption at July 13, 2006 was 6.23%. The weighted average initial health care cost trend rate was 6% for the 2006 calendar year.

NOTE 15. GUARANTEES

The fair values of guarantees and indemnifications during 2006 and 2005 are recorded in the financial statements and are de minimis .

At September 30, 2006, the following guarantees were issued and outstanding:

Guarantees related to affiliates and third parties: We guarantee debt and lease obligations of certain joint ventures, as well as certain financial obligations of outside third parties to support business and economic growth. Expiration dates vary, and guarantees will terminate on payment and/or cancellation of the obligation. A payment by us would be triggered by failure of the guaranteed party to fulfill its obligation covered by the guarantee. In some circumstances, we are entitled to recover from the third party amounts paid by us under the guarantee. However, our ability to enforce these rights is sometimes stayed until the guaranteed party is paid in full, and may be limited in the event of insolvency of the third party or other circumstances. The maximum potential payments under these guarantees total $107 million.

On December 21, 2005, we completed the sale of The Hertz Corporation ("Hertz"). As part of this transaction, we provided cash-collateralized letters of credit in an aggregate amount of $200 million to support the asset-backed portion of the buyer's financing for the transaction. As of September 30, 2006, the carrying value of our deferred gain related to the letters of credit was $24 million, which represents the estimated fair value of our guarantee. For further discussion of these letters of credit, see Note 27 of the Notes to the Financial Statements in our 2005 Form 10-K/A Report.

In 1996, we issued $500 million of 7.25% Notes due October 1, 2008. In 1999, we entered into a de-recognition transaction to defease our obligation as primary obligor with respect to the principal of these notes. As part of this transaction, we placed certain financial assets into an escrow trust for the benefit of the noteholders, and the trust became the primary obligor with respect to the principal (we became secondarily liable for the entire principal amount).

We also have guarantees outstanding associated with a subsidiary trust, Ford Motor Company Capital Trust II ("Trust II"). For further discussion of Trust II, see Notes 16 and 18 of the Notes to the Financial Statements in our 2005 Form 10-K/A Report.

No losses have been recorded for these guarantees .

Indemnifications: We regularly evaluate the probability of having to incur costs associated with indemnifications contained in contracts to which we are a party, and have accrued for expected losses that are probable and for which a loss can be estimated. During the third quarter of 2006, there were no significant changes to our indemnifications.

Item 1. Financial Statements (Continued)

NOTE 15. GUARANTEES (Continued)

Product Performance

Warranty: Estimated warranty costs and additional service actions are accrued for at the time the vehicle is sold to a dealer. Included in the warranty cost accruals are costs for basic warranty coverages on vehicles sold. Additional service actions, such as product recalls and other customer service actions, are not included in the warranty reconciliation below, but are also accrued for at the time of sale. Estimates for warranty costs are made based primarily on historical warranty claim experience. The following is a tabular reconciliation of the product warranty accruals (in millions):

	First Nine Months
	2006			2005
Beginning balance	$	6,243		$	5,814
Payments made during the period		(3,071	)		(3,032	)
Changes in accrual related to warranties issued during the period		2,598			2,936
Changes in accrual related to pre-existing warranties		133			651
Foreign currency translation and other		121			(160	)
Ending balance	$	6,024		$	6,209

Extended Service Plans: Fees or premiums for the issuance of extended service plans are recognized in income over the contract period in proportion to the costs expected to be incurred in performing services under the contract.

NOTE 16. SEGMENT INFORMATION

We review and present our business results in two sectors: Automotive and Financial Services. Within these sectors, our business is divided into reportable segments based upon the organizational structure that we use to evaluate performance and make decisions on resource allocation, as well as availability and materiality of separate financial results consistent with that structure.

Beginning with the second quarter of 2006, we changed the reporting of our Automotive sector to separately disclose the following segments: Ford North America, Ford South America, Ford Europe, PAG, and Ford Asia Pacific and Africa/Mazda. Automotive sector prior-period information has been reclassified and is provided for these segments in the tables below.

Item 1. Financial Statements (Continued)

NOTE 16. SEGMENT INFORMATION (Continued)

(In Millions)
	Automotive Sector
	Ford North America			Ford South America		Total The Americas			Ford Europe			PAG			Ford Asia Pacific & Africa/ Mazda			Total International			Other			Total
THIRD QUARTER 2006
Revenues
External customer	$	15,395		$	1,523	$	16,918		$	7,275		$	6,490		$	1,873		$	15,638		$	—		$	32,556
Intersegment		(10	)		—		(10	)		183			62			—			245			—			235
Income
Income/(loss) before income taxes		(5,733	)		300		(5,433	)		(34	)		(2,177	)		(16	)		(2,227	)		553			(7,107	)

THIRD QUARTER 2005
Revenues
External customer	$	18,187		$	1,159	$	19,346		$	6,402		$	6,770		$	2,138		$	15,310		$	—		$	34,656
Intersegment		418			—		418			286			54			24			364			—			782
Income
Income/(loss) before income taxes		(1,434	)		98		(1,336	)		(131	)		(128	)		133			(126	)		(95	)		(1,557	)

	Financial Services Sector (a)												Total Company
	Ford Credit		Hertz (b)		Other			Elims			Total		Elims (c)			Total
THIRD QUARTER 2006
Revenues
External customer	$	4,489	$	—	$	65		$	—		$	4,554	$	—		$	37,110
Intersegment		216		—		8			(1	)		223		(458	)		—
Income
Income/(loss) before income taxes		730		—		20			—			750		—			(6,357	)

THIRD QUARTER 2005
Revenues
External customer	$	3,702	$	2,128	$	24		$	—		$	5,854	$	—		$	40,510
Intersegment		127		5		21			(19	)		134		(916	)		—
Income
Income/(loss) before income taxes		393		350		(29	)		—			714		—			(843	)

__________

(a)	Financial Services sector’s interest income is recorded as Revenues.

(b)	We sold 100% of our interest in Hertz during the fourth quarter of 2005.

(c)	Includes intersector transactions occurring in the ordinary course of business.

Item 1. Financial Statements (Continued)

NOTE 16. SEGMENT INFORMATION (Continued)

(In Millions)
	Automotive Sector
	Ford North America			Ford South America		Total The Americas			Ford Europe		PAG			Ford Asia Pacific & Africa/ Mazda		Total International			Other		Total
FIRST NINE MONTHS 2006
Revenues
External customer	$	54,335		$	3,974	$	58,309		$	21,575	$	21,383		$	6,089	$	49,047		$	—	$	107,356
Intersegment		401			—		401			707		176			4		887			—		1,288
Income
Income/(loss) before income taxes		(9,955	)		547		(9,408	)		193		(2,208	)		204		(1,811	)		306		(10,913	)
Total assets at September 30																						113,926

FIRST NINE MONTHS 2005
Revenues
External customer	$	59,330		$	3,067	$	62,397		$	21,984	$	22,284		$	6,113	$	50,381		$	—	$	112,778
Intersegment		2,806			—		2,806			1,365		432			89		1,886			—		4,692
Income
Income/(loss) before income taxes		(2,004	)		268		(1,736	)		—		(217	)		337		120			41		(1,575	)
Total assets at September 30																						109,823

	Financial Services Sector (a)												Total Company
	Ford Credit		Hertz (b)		Other			Elims			Total		Elims (c)			Total
FIRST NINE MONTHS 2006
Revenues
External customer	$	12,252	$	—	$	197		$	—		$	12,449	$	—		$	119,805
Intersegment		528		—		24			(4	)		548		(1,836	)		—
Income
Income/(loss) before income taxes		1,547		—		3			—			1,550		—			(9,363	)
Total assets at September 30		163,017		—		10,633			(9,457	)		164,193		(994	)		277,125

FIRST NINE MONTHS 2005
Revenues
External customer	$	12,022	$	5,639	$	132		$	—		$	17,793	$	—		$	130,571
Intersegment		439		14		34			(27	)		460		(5,152	)		—
Income
Income/(loss) before income taxes		2,441		536		(65	)		—			2,912		—			1,337
Total assets at September 30		149,368		15,961		12,464			(11,603	)		166,190		(1,592	)		274,421

__________

(a)	Financial Services sector’s interest income is recorded as Revenues.

(b)	We sold 100% of our interest in Hertz during the fourth quarter of 2005.

(c)	Includes intersector transactions occurring in the ordinary course of business.

Report of Independent Registered Public Accounting Firm

To Board of Directors and Stockholders

Ford Motor Company:

We have reviewed the accompanying consolidated balance sheet of Ford Motor Company and its subsidiaries as of September 30, 2006, and the related consolidated statements of income for each of the three-month and nine-month periods ended September 30, 2006 and 2005 and the condensed consolidated statement of cash flows for the nine-month periods ended September 30, 2006 and 2005. These interim financial statements are the responsibility of the Company’s management.

The accompanying sector balance sheets and the related sector statements of income and of cash flows are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information has been subjected to the review procedures applied in the review of the basic financial statements.

We conducted our review in accordance with the standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should be made to the accompanying consolidated interim financial statements for them to be in conformity with accounting principles generally accepted in the United States of America.

As discussed in Note 2 of the Notes to the Financial Statements, the Company has restated its consolidated financial statements and sector financial information for the three- and nine-month periods ended September 30, 2005.

We have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet as of December 31, 2005, and the related consolidated statements of income, of cash flows, and of stockholders’ equity for the year then ended (not presented herein), and in our report dated March 1, 2006, except for the effect of the restatement described in Note 28 of the Notes to the Financial Statements in the Company's Annual Report on Form 10-K/A for the year ended December 31, 2005 ("2005 Form 10-K/A Report"), as to which the date is November 14, 2006, appearing in Item 8 in the Company’s 2005 Form 10-K/A Report, we expressed an unqualified opinion thereon (with an explanatory paragraph relating to the restatement of the consolidated financial statements). In our opinion, the information set forth in the accompanying consolidated balance sheet as of December 31, 2005, is fairly stated in all material respects in relation to the consolidated balance sheet from which it has been derived.

/s/ PricewaterhouseCoopers LLP

PricewaterhouseCoopers LLP

Detroit, Michigan

November 14, 2006

ITEM 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations.

OVERVIEW

ACCELERATION OF THE WAY FORWARD PLAN

On January 23, 2006, we announced a major business improvement plan for our North American Automotive operations, which we refer to as the Way Forward plan. Key aspects of that plan are set forth in our 2005 Form 10-K/A Report. On September 15, 2006, responding to changing facts and circumstances, Ford announced an acceleration of this plan, including actions designed to further reduce operating costs and increase the flow of new products, and issued a revised financial outlook.

Cost Reductions

Personnel reductions

Acceleration of the Way Forward plan includes additional reductions of our capacity and workforce to contribute to our goal of reducing annual operating costs by about $5 billion by the end of 2008 as compared with 2005. Our accelerated plan reduces salaried-related costs through the elimination of the equivalent of about 14,000 salaried-related positions, which represents about one-third of our North American salaried workforce. This reduction includes our elimination of the equivalent of 4,000 salaried positions in the first quarter of 2006; the additional reductions will be achieved through early retirements, voluntary separations and, if necessary, involuntary separations, with most reductions expected to be completed by the end of the first quarter of 2007.

By agreement with the UAW, we also are extending early retirement or separation packages to all U.S. hourly employees, including Ford employees at our ACH plants. Hourly employees who accept an early retirement or separation offer are expected to separate from the Company no later than September 2007.

With these actions, we plan to accelerate by four years our goal of reducing our total employment by 25,000 to 30,000 North American hourly employees (excluding ACH), so that these reductions will be completed by the end of 2008. The accelerated plan to sell or close all ACH facilities by the end of 2008 will result in additional personnel reductions.

Capacity alignment

As originally announced, our overall goal is to reduce North American manufacturing capacity to approximately 3.6 million units by the end of 2008, down 26 percent versus year-end 2005. As part of this reduction, we have announced that nine facilities will be idled and cease production by the end of 2008; we have idled two of these facilities already (St. Louis Assembly Plant in the first quarter and Atlanta Assembly Plant in October of 2006).

The list of additional facilities to be idled by the end of 2008 includes (in alphabetical order): Batavia Transmission Plant (to be idled in 2008); Essex Engine Plant (to cease operations in 2007); Maumee Stamping Plant (to be idled in 2008); Norfolk Assembly Plant (to be idled in 2007, with an initial shift reduction planned for January 2007); Twin Cities Assembly Plant (to be idled in 2008, with an initial shift reduction planned in January 2007); Windsor Casting Plant (to be idled in 2007); and Wixom Assembly Plant (to be idled in 2007). At the same time, Dearborn Truck Plant will add a third shift beginning in 2007 to accommodate additional F-150 truck production.

Overall, we have announced plans to cease production at 16 North American manufacturing facilities, including seven assembly plants, by the end of 2012. Additionally, we plan to sell or close all ACH facilities by the end of 2008.

Product Actions

As part of our acceleration of the Way Forward plan, we have announced that 70 percent of Ford, Lincoln, and Mercury products (by volume) will be new or significantly upgraded by the end of 2008; these efforts will include the expansion of our product lineup in growth segments such as crossover vehicles. In the next few months, we will be introducing the all-new Ford Edge and Lincoln MKX crossover vehicles, and new models of our segment-leading Ford Super Duty trucks, Lincoln MKZ sedan, and Mercury Mariner compact sport utility vehicle and hybrid. We continue to invest in new gasoline, flexible-fuel, diesel, hydrogen, and hybrid powertrains, as well as fuel-saving six-speed transmission technology.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Financial Impact

Even as we accelerate our Way Forward plan, current circumstances suggest that we will not reach full-year profitability in our North American Automotive operations before 2009. We anticipate that our Ford, Lincoln and Mercury market share in the United States will be in the low-16 percent range at the end of 2006, with a further decline expected as production of the Ford Taurus sedan and Mercury Monterey minivan ends in 2006 and production of the Ford Freestar minivan ends in 2007; ending production of these vehicles will further reduce our sales to daily rental fleets, consistent with our previously-announced goal to reduce our exposure to this segment of the market, and will consequently reduce our overall market share. With our planned investment in new products and expected improvements in quality, we anticipate U.S. market share to stabilize in the 14 percent to 15 percent range going forward, with a focus on profitable retail share. Further discussion of our outlook for 2006 full-year performance against our financial milestones (including costs associated with the accelerated Way Forward plan, profitability by operation, and liquidity measures) is set forth in the "Outlook" section of "Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations."

RESTATEMENT

In October 2006, we reviewed our application of Paragraph 68 of SFAS No. 133, and its use at our indirect wholly-owned subsidiary, Ford Credit. One of the general requirements of SFAS No. 133 is that hedge accounting is appropriate only for those hedging relationships that a company expects will be highly effective in achieving offsetting changes in fair value or cash flows attributable to the risk being hedged. To determine whether transactions satisfy this requirement, companies must periodically assess the effectiveness of hedging relationships both prospectively and retrospectively. Paragraph 68 of SFAS No. 133 contains an exception from these periodic assessment requirements in the form of an "assumption of no ineffectiveness" for certain hedges of interest rate risk that involve interest rate swaps and recognized interest-bearing assets or liabilities. The exception identifies the specific requirements for the derivative and hedged items that must be met, such as a derivative fair value of zero at inception of the hedging relationship, matching maturity dates, and contemporaneous formal documentation.

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.

Although we now have determined that the hedging relationships at issue in this restatement did not meet the specific criteria for an assumption of no ineffectiveness pursuant to Paragraph 68, we are precluded by SFAS No. 133 from retroactively performing full effectiveness testing in order to apply hedge accounting. Accordingly, the restated results in our 2005 Form 10-K/A Report reflect the changes in fair value of these instruments as derivative gains and losses during the affected periods, without recording any offsetting change in the value of the debt they were economically hedging.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Subsequent to the completion of our originally-filed financial statements for each period being restated, we identified adjustments that should have been recorded in these earlier periods. Upon identification, we determined these adjustments to be immaterial, individually and in the aggregate, to our originally-filed financial statements, and generally recognized these adjustments in the period in which they were identified. Because the Ford Credit interest rate swap adjustment has required a restatement, we also are reversing these out-of-period adjustments and recording them in the proper periods.

THIRD QUARTER RESULTS OF OPERATIONS

Our worldwide net loss was $5.2 billion or $2.79 per share of Common and Class B stock in the third quarter of 2006, down from a loss of $576 million or $0.31 per share in the third quarter of 2005.

Results by business sector for the third quarter of 2006 and 2005 are shown below (in millions):

	Third Quarter
	2006			Restated 2005			2006 Over/ (Under) 2005
Income/(loss) before income taxes
Automotive sector	$	(7,107	)	$	(1,557	)	$	(5,550	)
Financial Services sector		750			714			36
Total		(6,357	)		(843	)		(5,514	)
Provision for/(benefit from) income taxes		(1,157	)		(314	)		(843	)
Minority interests in net income/(loss) of subsidiaries *		48			54			(6	)
Income/(loss) from continuing operations		(5,248	)		(583	)		(4,665	)
Income/(loss) from discontinued operations		—			7			(7	)
Net income/(loss)	$	(5,248	)	$	(576	)	$	(4,672	)

*	Primarily related to Ford Europe's consolidated less-than-100%-owned affiliates.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Included in Income/(loss) before income taxes are items we do not consider indicative of our ongoing operating activities (“special items”). The following table details the third quarter 2006 and 2005 special items by segment or business unit (in millions):

	Third Quarter
	2006			2005
Ford North America
Fixed asset impairment charges	$	(2,200	)	$	—
Jobs Bank Benefits and voluntary termination charges (primarily related to the Way Forward plan)		(861	)		—
Pension curtailment charges		(437	)		—
Additional personnel-reduction programs		(169	)		(76	)
Visteon-related charges (primarily valuation allowance against employee-related receivables)		—			(180	)
Fuel-cell technology charges		—			(66	)
Total Ford North America		(3,667	)		(322	)
Ford South America
Legal settlement relating to social welfare tax liability		99			—
Ford Europe
Personnel-reduction programs		(21	)		(49	)
PAG
Fixed asset impairment charges		(1,600	)		—
Personnel-reduction programs		(69	)		(33	)
Other Automotive
Divestiture of non-core business		—			146
Total Automotive Sector		(5,258	)		(258	)

Financial Services Sector
Divestiture of non-core business (Hertz)		—			84

Total	$	(5,258	)	$	(174	)

AUTOMOTIVE SECTOR

Details by Automotive segment or business unit of Income/(loss) before income taxes for the third quarter of 2006 and 2005 are shown below (in millions):

	Third Quarter
	2006			Restated 2005			2006 Over/ (Under) 2005
The Americas Operations
Ford North America	$	(5,733	)	$	(1,434	)	$	(4,299	)
Ford South America		300			98			202
Total The Americas Operations		(5,433	)		(1,336	)		(4,097	)

International Operations
Ford Europe		(34	)		(131	)		97
PAG		(2,177	)		(128	)		(2,049	)
Subtotal Ford Europe and PAG		(2,211	)		(259	)		(1,952	)

Ford Asia Pacific and Africa		(56	)		21			(77	)
Mazda and Associated Operations		40			112			(72	)
Subtotal Ford Asia Pacific and Africa/Mazda		(16	)		133			(149	)
Total International Operations		(2,227	)		(126	)		(2,101	)

Other Automotive		553			(95	)		648
Total	$	(7,107	)	$	(1,557	)	$	(5,550	)

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Details by Automotive segment or business unit of sales and vehicle unit sales for the third quarter of 2006 and 2005 are shown below:

	Third Quarter
	Sales (in billions)									Vehicle Unit Sales (a) (in thousands)
	2006		2005		2006 Over/(Under) 2005					2006		2005		2006 Over/(Under) 2005
The Americas Operations
Ford North America	$	15.4	$	18.2	$	(2.8	)	(15	)%		710		774		(64	)	(8	)%
Ford South America		1.5		1.2		0.3		31			101		88		13		15
Total The Americas Operations		16.9		19.4		(2.5	)	(13	)		811		862		(51	)	(6	)

International Operations
Ford Europe		7.3		6.4		0.9		13			412		371		41		11
PAG		6.5		6.8		(0.3	)	(4	)		149		169		(20	)	(12	)
Subtotal Ford Europe and PAG		13.8		13.2		0.6		4			561		540		21		4

Ford Asia Pacific and Africa (b)		1.6		1.9		(0.3	)	(15	)		125		115		10		9
Mazda and Associated Operations (c)		0.3		0.2		0.1		6			14		14		—		—
Subtotal Ford Asia Pacific and Africa/Mazda		1.9		2.1		(0.2	)	(12	)		139		129		10		8
Total International Operations		15.7		15.3		0.4		2			700		669		31		5
Total	$	32.6	$	34.7	$	(2.1	)	(6	)%		1,511		1,531		(20	)	(1	)%

__________

(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 38,000 and 19,000 units in 2006 and 2005, respectively. "Sales" above does not include revenue from these units.

(c)	This reflects sales of Mazda6 by our affiliate, AutoAlliance International, Inc. ("AAI"), which we began consolidating in the third quarter of 2005.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Details of Automotive sector market share for selected markets for the third quarter of 2006 and 2005, along with the level of dealer stocks as of September 30, 2006 and 2005, are shown below:

	Third Quarter										Dealer-Owned Stocks (a)
	Market Share										(in thousands)
Market	2006			2005			2006 Over/(Under) 2005				Sept. 30 , 2006		Sept. 30 , 2005		2006 Over/(Under) 2005

U.S. (b)		15.5	%		17.5	%		(2.0	)	pts.		652		647		5
South America (b) (c)		11.5			12.0			(0.5	)			38		39		(1	)
Europe (b) (d)		8.6			8.5			0.1				297		294		3
PAG -- U.S./Europe (d)		1.0/ 2.0			1.1/ 2.2			(0.1)/(0.2	)			35/ 51		42/ 59		(7)/ (8	)
Asia Pacific and Africa (b) (e) (f)		2.5			2.3			0.2				58		53		5

_________

(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, including some vehicles reflected in our inventory.

(b)	Includes only Ford and, in certain markets (primarily U.S.), Lincoln and Mercury brands.

(c)	South America 2006 market share is based on estimated vehicle retail sales for our six major markets (Argentina, Brazil, Chile, Colombia, Ecuador and Venezuela).

(d)	European 2006 market share is based, in part, on estimated vehicle registrations for our 19 major European markets.

(e)	Asia Pacific and Africa 2006 market share is based on estimated vehicle retail sales for our 12 major markets (Australia, China, Japan, India, Indonesia, Malaysia, New Zealand, Philippines, South Africa, Taiwan, Thailand, and Vietnam).

(f)	Dealer-owned stocks for Asia Pacific and Africa include primarily Ford-brand vehicles as well as a small number of units distributed for other manufacturers.

Overall Automotive Sector

The decline in earnings primarily reflected impairment charges related to our long-lived assets in Ford North America (about $2.2 billion) and Jaguar/Land Rover operations (about $1.6 billion), unfavorable volume and mix (mainly lower market share and lower industry volume in the United States) (about $1.0 billion), Jobs Bank Benefits and voluntary termination charges (about $900 million), pension curtailment charges (about $400 million), and unfavorable net pricing (about $400 million). These adverse factors were offset partially by higher net interest income - including settlements of prior-year federal and state tax matters, favorable tax-related interest on refund claims, and higher returns on our cash portfolio (about $800 million) - and favorable cost changes (about $400 million). See "First Nine Months Results of Operations - Automotive Sector" for a discussion of cost changes.

The decline in revenues primarily reflected lower volumes, unfavorable product mix, and unfavorable net pricing in Ford North America. These factors were offset partially by favorable changes in currency exchange rates.

The Americas Operations

Ford North America Segment. The decline in earnings primarily reflected the impairment charges related to long-lived assets, unfavorable volume and mix (mainly lower market share and lower industry volume in the United States), Jobs Bank Benefits and voluntary termination charges, unfavorable net pricing, and pension curtailment charges, offset partially by favorable cost changes. The favorable cost changes reflected improvements in warranty-related costs and pension and OPEB costs.

Ford South America Segment. The increase in earnings primarily reflected a legal settlement relating to a social welfare tax liability, higher industry volume, and favorable net pricing.

International Operations

Ford Europe Segment. The improvement in earnings primarily reflected favorable volume and mix, offset partially by higher pension costs, and lower profits from operations in Turkey.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

PAG Segment. The decline in earnings primarily reflected impairment charges related to long-lived assets at our Jaguar/Land Rover operations, adjustments to warranty accruals for prior model-year vehicles (mainly at Jaguar and Land Rover), and lower volumes at all operations except Aston Martin, offset partially by favorable product and market mix at Jaguar and Volvo.

Ford Asia Pacific and Africa/Mazda Segment. The decline in results for Ford Asia Pacific and Africa primarily reflected lower production in Taiwan and Australia, adverse product mix, and unfavorable net pricing, offset partially by favorable cost changes (mainly improvements in manufacturing and engineering costs). Vehicle unit sales for the period increased while revenue for the same period declined. The increase in vehicle unit sales is explained by higher unit sales in China and India, offset partially by declines in Taiwan and Australia. Our revenue excludes vehicle unit sales at our unconsolidated affiliates, primarily those in China. The decrease in revenue primarily reflects lower volumes outside of China and changes in currency exchange rates.

The decrease in earnings for Mazda and Associated Operations primarily reflected the non-recurrence of gains on our investment in Mazda convertible bonds. During the second half of 2005 and the first quarter of 2006, we converted to equity all of our Mazda convertible bonds, and, therefore, will no longer have income effects from the mark-to-market adjustments for these bonds.

Other Automotive

The improvement in results primarily reflected the favorable effects on interest expense of settlements of prior-year federal and state tax matters, favorable tax-related interest on refund claims, and higher returns on our cash portfolio, offset partially by the non-recurrence of a gain from the sale of our remaining interest in Kwik-Fit Group Limited .

FINANCIAL SERVICES SECTOR

Details of Financial Services sector Revenues and Income/(loss) before income taxes for the third quarter of 2006 and 2005 are shown below:

	Third Quarter
	Revenues (in billions)							Income/(Loss) Before Income Taxes (in millions)
	2006		Restated 2005		2006 Over/(Under) 2005			2006		Restated 2005			2006 Over/(Under) 2005

Ford Credit	$	4.4	$	3.7	$	0.7		$	730	$	393		$	337
Other Financial Services		0.1		—		0.1			20		(29	)		49
Hertz		—		2.1		(2.1	)		—		350			(350	)
Total	$	4.5	$	5.8	$	(1.3	)	$	750	$	714		$	36

We sold Hertz during the fourth quarter of 2005, resulting in declines in Revenues and Income/(loss) before income taxes during 2006.

Ford Credit

The increase in earnings primarily reflected market valuations related to non-designated derivatives and improved operating expenses. The increase was offset partially by higher borrowing costs, higher depreciation expense, and the impact of lower average receivables.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Ford Credit's net finance receivables and net investment in operating leases are shown below (in billions):

	September 30, 2006		December 31, 2005		2006 Over/(Under) 2005

On-Balance Sheet (including on-balance sheet securitizations) *	$	135.0	$	132.1	$	2.9
Securitized Off-Balance Sheet		12.9		18.0		(5.1	)
Managed	$	147.9	$	150.1	$	(2.2	)

Serviced	$	150.4	$	153.0	$	(2.6	)

__________

At September 30, 2006 and December 31, 2005, about $52.0 billion and $44.7 billion, respectively, of finance receivables have been sold for legal purposes in securitization transactions that do not satisfy the requirements for accounting sale treatment. In addition, at September 30, 2006 and December 31, 2005, interests in operating leases and the related vehicles of $12.5 billion and $6.5 billion, respectively , have been transferred for legal purposes and are held for the benefit of consolidated securitization SPEs. These receivables and interests in operating leases and the related vehicles are available only for repayment of debt or other obligations issued or arising in the securitization transactions and to pay other transaction participants; they are not available to pay Ford Credit's other obligations or the claims of Ford Credit's other creditors.

Managed receivables decreased from year-end 2005 primarily reflecting lower wholesale receivable levels, offset partially by increased investments in operating leases. At year-end 2006, Ford Credit anticipates managed receivables to be in the range of $145 billion to $150 billion. The year-end receivables forecast is up slightly from prior expectations due to our third quarter marketing programs that emphasized retail financing incentives through Ford Credit.

The following table shows worldwide credit losses net of recoveries, which are referred to as charge-offs, and loss-to-receivables ratios, which equal charge-offs for the period on an annualized basis divided by the average amount of receivables outstanding for the period, for the third quarter of 2006 and 2005:

	Third Quarter
	2006			2005			2006 Over/(Under) 2005
Charge-offs (in millions)
On-Balance Sheet	$	140		$	175		$	(35	)
Managed		161			211			(50	)


Loss-to-Receivables Ratios
On-Balance Sheet		0.41	%		0.58	%		(0.17	)	pts.
Managed		0.43	%		0.55	%		(0.12	)	pts.

The improvements primarily reflected a higher quality retail installment and lease portfolio and enhancements to Ford Credit's collection practices. Lower average levels of retail installment receivables in our managed portfolio also contributed to reduced charge-offs.

Shown below is Ford Credit's allowance for credit losses related to finance receivables and operating leases for the periods specified. Consistent with its normal practices and policies, Ford Credit assesses the adequacy of its allowance for credit losses quarterly and regularly evaluates the assumptions and models used in establishing the allowance. During the third quarter, Ford Credit updated its analysis of contract liquidation data which affected the level of required reserves for credit losses as of September 30, 2006. In addition, Ford Credit implemented refinements to certain modeling techniques that are used in determining the allowance for credit losses. The combined effect of the two changes decreased the allowance for credit losses by $66 million at September 30, 2006.

	September 30, 2006			December 31, 2005			2006 Over/(Under) 2005

Allowance for credit losses (in billions)	$	1.3		$	1.6		$	(0.3	)
Allowance as a percentage of end-of-period receivables		0.93	%		1.19	%		(0.26	)	pts.

Ford Credit's allowance for credit losses decreased approximately $300 million from year-end 2005, primarily reflecting improved charge-off performance and changes in our estimation process referenced above that affected the allowance, offset partially by an increase in our on-balance sheet retail receivables and investments in operating leases.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Other Financial Services

The improvement in results primarily reflected the non-recurrence of the write-off of aircraft leases related to the bankruptcy of Delta Air Lines.

FIRST NINE MONTHS RESULTS OF OPERATIONS

Our worldwide net loss was $7.0 billion or $3.73 per share of Common and Class B stock in the first nine months of 2006, down from a profit of $1.5 billion or $0.79 per share in the first nine months of 2005.

Results by business sector for the first nine months of 2006 and 2005 are shown below (in millions):

	First Nine Months
	2006			Restated 2005			2006 Over/ (Under) 2005
Income/(loss) before income taxes
Automotive sector	$	(10,913	)	$	(1,575	)	$	(9,338	)
Financial Services sector		1,550			2,912			(1,362	)
Total		(9,363	)		1,337			(10,700	)
Provision for/(benefit from) income taxes		(2,499	)		(328	)		(2,171	)
Minority interests in net income/(loss) of subsidiaries *		126			196			(70	)
Income/(loss) from continuing operations		(6,990	)		1,469			(8,459	)
Income/(loss) from discontinued operations		2			45			(43	)
Net income/(loss)	$	(6,988	)	$	1,514		$	(8,502	)

*	Primarily related to Ford Europe's consolidated less-than-100%-owned affiliates; the decrease primarily reflected the impact on deferred tax balances of tax law changes in the country of Turkey.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Included in Income/(loss) before income taxes are items we do not consider indicative of our ongoing operating activities ("special items"). The following table details the first nine months 2006 and 2005 special items by segment or business unit (in millions):

	First Nine Months
	2006			2005
Ford North America
Jobs Bank Benefits and voluntary termination charges (primarily related to the Way Forward plan)	$	(2,469	)	$	—
Fixed asset impairment charges		(2,200	)		—
Pension curtailment charges		(1,340	)		—
U.S. plant idlings (primarily fixed-asset write-offs)		(281	)		—
Additional personnel-reduction programs		(378	)		(139	)
Visteon-related charges (primarily valuation allowance against employee-related receivables)		—			(507	)
Fuel-cell technology charges		—			(116	)
Divestiture of non-core business		—			(59	)
Tax adjustments (result of law changes related to non-income taxes)		—			85
Total Ford North America		(6,668	)		(736	)
Ford South America
Legal settlement relating to social welfare tax liability		110			—
Ford Europe
Personnel-reduction programs		(44	)		(49	)
PAG
Fixed asset impairment charges		(1,600	)		—
Personnel-reduction programs		(90	)		(66	)
Ford Asia Pacific and Africa/Mazda
Mazda pension transfer		137			—
Divestiture of non-core businesses		—			14
Other Automotive
Divestiture of non-core businesses		—			146
Total Automotive Sector		(8,155	)		(691	)

Financial Services Sector
Divestiture of non-core business (Hertz)		—			84

Total	$	(8,155	)	$	(607	)

AUTOMOTIVE SECTOR

Details by Automotive segment or business unit of Income/(loss) before income taxes for the first nine months of 2006 and 2005 are shown below (in millions):

	First Nine Months
	2006			Restated 2005			2006 Over/ (Under) 2005
The Americas Operations
Ford North America	$	(9,955	)	$	(2,004	)	$	(7,951	)
Ford South America		547			268			279
Total The Americas Operations		(9,408	)		(1,736	)		(7,672	)

International Operations
Ford Europe		193			—			193
PAG		(2,208	)		(217	)		(1,991	)
Subtotal Ford Europe and PAG		(2,015	)		(217	)		(1,798	)

Ford Asia Pacific and Africa		(50	)		114			(164	)
Mazda and Associated Operations		254			223			31
Subtotal Ford Asia Pacific and Africa/Mazda		204			337			(133	)
Total International Operations		(1,811	)		120			(1,931	)

Other Automotive		306			41			265
Total	$	(10,913	)	$	(1,575	)	$	(9,338	)

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Details by Automotive segment or business unit of sales and vehicle unit sales for the first nine months of 2006 and 2005 are shown below:

	First Nine Months
	Sales (in billions)									Vehicle Unit Sales (a) (in thousands)
	2006		Restated 2005		2006 Over/(Under) 2005					2006		2005		2006 Over/(Under) 2005
The Americas Operations
Ford North America	$	54.3	$	59.3	$	(5.0	)	(8	)%		2,407		2,534		(127	)	(5	)%
Ford South America		4.0		3.1		0.9		30			275		246		29		12
Total The Americas Operations		58.3		62.4		(4.1	)	(7	)		2,682		2,780		(98	)	(4	)

International Operations
Ford Europe		21.6		22.0		(0.4	)	(2	)		1,305		1,270		35		3
PAG		21.4		22.3		(0.9	)	(4	)		526		559		(33	)	(6	)
Subtotal Ford Europe and PAG		43.0		44.3		(1.3	)	(3	)		1,831		1,829		2		—

Ford Asia Pacific and Africa (b)		5.2		5.9		(0.7	)	(12	)		397		342		55		16
Mazda and Associated Operations (c)		0.9		0.2		0.7		—			55		14		41		—
Subtotal Ford Asia Pacific and Africa/Mazda		6.1		6.1		—		—			452		356		96		27
Total International Operations		49.1		50.4		(1.3	)	(3	)		2,283		2,185		98		4
Total	$	107.4	$	112.8	$	(5.4	)	(5	)%		4,965		4,965		—		—	%

__________

(a)

(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 110,000 and 54,000 units in 2006 and 2005, respectively. "Sales" above does not include revenue from these units.

(c)	This reflects sales of Mazda6 by our affiliate, AAI, which we began consolidating in the third quarter of 2005.

Details of Automotive sector market share for selected markets for the first nine months of 2006 and 2005, along with the level of dealer stocks as of September 30, 2006 and 2005, are shown below:

	First Nine Months										Dealer-Owned Stocks (a)
	Market Share										(in thousands)
Market	2006			2005			2006 Over/(Under) 2005				Sept. 30, 2006		Sept. 30, 2005		2006 Over/(Under) 2005

U.S. (b)		16.4	%		17.3	%		(0.9	)	pts.		652		647		5
South America (b) (c)		11.5			12.1			(0.6	)			38		39		(1	)
Europe (b) (d)		8.5			8.6			(0.1	)			297		294		3
PAG -- U.S./Europe (d)		1.1/2.2			1.2/2.3			(0.1)/ (0.1	)			35/ 51		42/ 59		(7)/ (8	)
Asia Pacific and Africa (b) (e) (f)		2.4			2.3			0.1				58		53		5

_________

(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, including some vehicles reflected in our inventory.

(b)	Includes only Ford and, in certain markets (primarily U.S.), Lincoln and Mercury brands.

(c)	South America 2006 market share is based on estimated vehicle retail sales for our six major markets (Argentina, Brazil, Chile, Colombia, Ecuador and Venezuela).

(d)	European 2006 market share is based, in part, on estimated vehicle registrations for our 19 major European markets.

(e)	Asia Pacific and Africa 2006 market share is based on estimated vehicle retail sales for our 12 major markets (Australia, China, Japan, India, Indonesia, Malaysia, New Zealand, Philippines, South Africa, Taiwan, Thailand, and Vietnam).

(f)	Dealer-owned stocks for Asia Pacific and Africa include primarily Ford-brand vehicles as well as some units distributed for other manufacturers.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Overall Automotive Sector

The decline in earnings primarily reflected Jobs Bank Benefits and voluntary termination charges (about $2.5 billion), impairment charges related to our long-lived assets in Ford North America ($2.2 billion) and Jaguar/Land Rover operations ($1.6 billion), unfavorable volume and mix - mainly lower market share, lower industry volumes, and adverse product mix in North America (about $1.5 billion), pension curtailment charges (about $1.3 billion), unfavorable net pricing (about $1.0 billion), unfavorable currency exchange primarily due to the expiration of favorable hedges (about $500 million), and costs of U.S. plant idlings - primarily fixed-asset write-offs (about $300 million). These adverse factors were offset partially by favorable cost changes (about $1.1 billion) and the non-recurrence of Visteon-related charges - mainly valuation allowance against employee-related receivables (about $500 million).

The decline in revenues primarily reflected lower vehicle unit sales volume in North America, unfavorable changes in currency exchange rates for International Operations, unfavorable product mix, and unfavorable net pricing.

The table below details our first nine months cost changes at constant volume, mix, and exchange, excluding special items and discontinued operations (in billions):

Explanation of Cost Changes			2006 Better/(Worse) Than Restated 2005
Manufacturing and engineering	Primarily hourly and salaried personnel reductions and ongoing efficiencies in our plants.	$	0.7
Net product	Pricing reductions from our suppliers and design cost reductions on existing products, offset partially by commodity price increases.		0.4
Overhead	Primarily related to salaried personnel reductions.		0.4
Pension and OPEB	Primarily improvements beginning in the third quarter associated with our retiree health cost sharing agreement with the UAW, and improvements related to revisions to our salaried benefit plans, offset partially by the impact of reducing the discount rate and long-term expected return assumptions.		0.1
Warranty-related	Primarily reflects adjustments to Jaguar/Land Rover warranty accruals related to unfavorable prior model-year performance and the non-recurrence in 2006 of favorable reserve adjustments, offset partially by favorable coverage performance in North America.		(0.1	)
Depreciation and amortization	Acceleration of depreciation resulting from ongoing improvement plans including the announced facility idlings, offset partially by the favorable impact of the change in special tooling amortization method and the favorable impact of the impairment charge taken in the fourth quarter of 2005 for long-lived assets of Jaguar/Land Rover operations.		(0.2	)
Advertising & Sales Promotions	Primarily increased advertising costs.		(0.2	)
Total		$	1 .1

The Americas Operations

Ford North America Segment. The decline in earnings primarily reflected Jobs Bank Benefits and voluntary termination charges, impairment charges related to our long-lived assets, unfavorable volume and mix (mainly lower market share and adverse product mix in the United States), pension curtailment charges, unfavorable net pricing, and costs of U.S. plant idlings (primarily fixed-asset write-offs), offset partially by favorable cost changes. The favorable cost changes reflected improvements in manufacturing and engineering costs, pension and OPEB costs, net product costs, and overhead costs.

Ford South America Segment. The increase in earnings primarily reflected favorable net pricing, higher vehicle unit sales reflecting higher industry sales volume, and a legal settlement relating to a social welfare tax liability, offset partially by unfavorable cost changes. The unfavorable cost changes primarily reflected unfavorable net product costs and manufacturing and engineering costs.

International Operations

Ford Europe Segment. The increase in earnings primarily reflected favorable cost changes and favorable volume and mix, offset partially by lower profits from operations in Turkey, unfavorable net pricing and unfavorable changes in currency exchange rates. The favorable cost changes primarily reflected lower net product costs and overhead costs, offset partially by higher pension costs.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

PAG Segment. The decline in earnings primarily reflected impairment charges related to long-lived assets at our Jaguar/Land Rover operations, unfavorable currency exchange related to the expiration of favorable hedges, and unfavorable cost changes. The unfavorable cost changes primarily reflected adjustments to warranty accruals for prior model-year vehicles (mainly at Land Rover and Jaguar), offset partially by improvements in depreciation and amortization, overhead costs, and net product costs.

Ford Asia Pacific and Africa/Mazda Segment. The decline in results for Ford Asia Pacific and Africa primarily reflected lower production including lower industry volumes in Taiwan, adverse product mix including lower large car sales in Australia, unfavorable changes in currency exchange rates, and unfavorable net pricing, offset partially by favorable cost changes, including a grant from the Australian government for previously-incurred expenses. Vehicle unit sales for the period increased while revenue for the same period declined. The increase in vehicle unit sales is explained by higher unit sales in China and India, offset partially by declines in Taiwan. Our revenue excludes vehicle unit sales at our unconsolidated affiliates, primarily those in China. The decrease in revenue primarily reflects changes in currency exchange rates and a higher mix of small cars relative to the same period last year.

The increase in earnings for Mazda and Associated Operations primarily reflected our share of a gain Mazda realized on the transfer of its pension liabilities back to the Japanese government, offset partially by the non-recurrence of gains on our investment in Mazda convertible bonds. During the second half of 2005 and the first quarter of 2006, we converted to equity all of our Mazda convertible bonds, and, therefore, will no longer have income effects from the mark-to-market adjustments for these bonds.

Other Automotive

The increase in earnings primarily reflected higher returns on invested cash and lower interest expense, offset partially by non-recurrence of a gain from the sale of our remaining interest in Kwik-Fit Group Limited .

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

FINANCIAL SERVICES SECTOR

Details of Financial Services sector Revenues and Income/(loss) before income taxes for the first nine months of 2006 and 2005 are shown below:

	First Nine Months
	Revenues (in billions)							Income/(Loss) Before Income Taxes (in millions)
	2006		Restated 2005		2006 Over/(Under) 2005			2006		Restated 2005			2006 Over/(Under) 2005

Ford Credit	$	12.2	$	12.1	$	0.1		$	1,547	$	2,441		$	(894	)
Other Financial Services		0.2		0.1		0.1			3		(65	)		68
Hertz		—		5.6		(5.6	)		—		536			(536	)
Total	$	12.4	$	17.8	$	(5.4	)	$	1,550	$	2,912		$	(1,362	)

We sold Hertz during the fourth quarter of 2005, resulting in declines in Revenues and Income/(loss) before income taxes during 2006.

Ford Credit

The decrease in earnings primarily reflected higher borrowing costs, the impact of lower average receivables in Ford Credit's managed portfolio, and higher depreciation expense. The decrease was offset partially by market valuations primarily related to non-designated derivatives and improved operating expenses.

The following table shows worldwide charge-offs and loss-to-receivables ratios for the first nine months of 2006 and 2005:

	First Nine Months
	2006			2005			2006 Over/(Under) 2005
Charge-offs (in millions)
On-Balance Sheet	$	334		$	493		$	(159	)
Managed		399			609			(210	)

Loss-to-Receivables Ratios
On-Balance Sheet		0.33	%		0.53	%		(0.20	)	pts.
Managed		0.36	%		0.50	%		(0.14	)	pts.

The improvements in charge-offs and loss-to-receivables ratios for the on-balance sheet and managed portfolios primarily reflected a higher quality retail installment and lease portfolio and enhancements to Ford Credit's collection practices. Lower average levels of retail installment receivables in our managed portfolio also contributed to reduced charge-offs.

Other Financial Services

The improvement in results primarily reflected the non-recurrence of the write-off of aircraft leases related to the bankruptcy of Delta Air Lines and the non-recurrence of a loss on a property sale.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

LIQUIDITY AND CAPITAL RESOURCES

Automotive Sector

For the Automotive sector, liquidity and capital resources include gross cash balances, cash generated by operations, funds raised in capital markets, and committed credit lines.

Gross Cash. Automotive gross cash includes cash and cash equivalents, marketable and loaned securities, and short-term VEBA assets as detailed below (in billions):

	Sept. 30, 2006		Dec. 31, 2005		Sept. 30, 2005		Dec. 31, 2004

Cash and cash equivalents	$	13.5	$	13.4	$	9.1	$	10.1
Marketable securities		7.8		6.9		7.9		8.3
Loaned securities		0.6		3.4		0.6		1.1
Total cash, marketable securities and loaned securities		21.9		23.7		17.6		19.5
Short-term VEBA assets *		1.7		1.4		2.0		4.1
Gross cash	$	23.6	$	25.1	$	19.6	$	23.6

________

*	Amounts that are invested in shorter-duration fixed income investments that are able to be used within 18 months to pay for retiree benefits.

In managing our business, we classify changes in Automotive gross cash into two categories: operating-related and other (which includes pension contributions, the net effect of the change in our VEBA on cash, certain special items, tax refunds, capital transactions with the Financial Services sector, acquisitions and divestitures and other - primarily financing related). Our key metrics are operating-related cash flow, which best represents the ability of our Automotive operations to generate cash, and Automotive gross cash. We believe the cash flow analysis reflected in the table below, which differs from a cash flow statement presented in accordance with generally accepted accounting principles ("GAAP"), is useful to investors because it includes cash flow elements that we consider to be related to our operating activities (e.g., capital spending) that are not included in Net cash flows from operating activities of continuing operations , the most directly comparable GAAP financial measure.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Changes in Automotive gross cash for the third quarter and first nine months of 2006 and 2005 are summarized below (in billions):

	Third Quarter						First Nine Months
	2006			Restated 2005			2006			Restated 2005
Gross cash at end of period	$	23.6		$	19.6		$	23.6		$	19.6
Gross cash at beginning of period		23.6			21.8			25.1			23.6
Total change in gross cash	$	—		$	(2.2	)	$	(1.5	)	$	(4.0	)

Operating-related cash flows
Automotive income/(loss) before income taxes	$	(7.1	)	$	(1.6	)	$	(10.9	)	$	(1.6	)
Special items		5.3			0.3			8.1			0.7
Capital expenditures		(1.8	)		(1.8	)		(5.2	)		(5.1	)
Depreciation and special tools amortization		1.8			1.6			5.3			5.1
Changes in receivables, inventories and trade payables		(0.4	)		0.3			(1.3	)		0.1
Other (a)		(1.1	)		(1.5	)		0.2			(1.2	)
Total operating-related cash flows		(3.3	)		(2.7	)		(3.8	)		(2.0	)

Other changes in cash
Contributions to funded pension plans		(0.1	)		(0.1	)		(0.6	)		(2.4	)
Net effect of VEBA on cash		3.0			—			3.0			(0.2	)
Cash impact of personnel-reduction programs and Jobs Bank Benefits accrual		(0.3	)		(0.1	)		(0.9	)		(0.3	)
Capital transactions with Financial Services sector (b)		0.3			1.0			0.9			2.2
Dividends paid to shareholders		(0.1	)		(0.2	)		(0.5	)		(0.6	)
Changes in total Automotive sector debt		—			(0.1	)		(0.2	)		(0.4	)
Other (c)		0.5			—			0.6			(0.3	)
Total change in gross cash	$	—		$	(2.2	)	$	(1.5	)	$	(4.0	)

__________

(a)	Primarily expense and payment timing differences for items such as marketing, warranty, pension and OPEB.

(b)	Primarily dividends received from Ford Credit, excluding proceeds from Financial Services sector divestitures paid to the Automotive sector.

(c)	In the third quarter of 2006, primarily tax refunds (an inflow of about $300 million), the net issuance of Ford Common Stock under employee savings plans (an inflow of about $100 million) and proceeds from the sale of select non-automotive properties (an inflow of about $100 million).

Shown in the table below is a reconciliation between financial statement Cash flows from operating activities of continuing operations and operating-related cash flows (calculated as shown in the table above) for the third quarter of 2006 and 2005 (in billions):

	Third Quarter						First Nine Months
	2006			Restated 2005			2006			Restated 2005
Net cash flows from operating activities of continuing operations	$	(0.3	)	$	(0.6	)	$	5.0		$	4.5
Items included in operating-related cash flows
Capital expenditures		(1.8	)		(1.8	)		(5.2	)		(5.1	)
Net transactions between Automotive and Financial Services sector *		(0.1	)		0.2			(0.5	)		(0.2	)
Items not included in operating-related cash flows
Cash impact of Jobs Bank Benefits and separation programs		0.3			0.1			0.9			0.3
Net (sales)/purchases of trading securities		(0.1	)		(0.3	)		(1.8	)		(1.3	)
Pension contributions		0.1			0.1			0.6			2.4
VEBA cash flows - Net reimbursement for benefits paid		(1.3	)		(0.6	)		(2.7	)		(2.1	)
Other		(0.1	)		0.2			(0.1	)		(0.5	)
Operating-related cash flows	$	(3.3	)	$	(2.7	)	$	(3.8	)	$	(2.0	)

__________

*	Primarily payables and receivables between the sectors in the normal course of business.

See discussion in "Outlook" section regarding our exploration of various financing strategies, including secured financing to fund our negative cash flow in future quarters.

Debt. At September 30, 2006, our Automotive sector had total debt of $17.7 billion, compared with $17.9 billion at December 31, 2005. Total senior debt at September 30, 2006 was $12.5 billion, compared with $12.7 billion at December 31, 2005. The decrease in senior debt primarily reflected the maturity of two small bonds totaling about $200 million.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Credit Facilities. At September 30, 2006, the Automotive sector had $6.7 billion of contractually-committed credit facilities with financial institutions, of which $6.4 billion was available for use. Of the lines available for use, 77% (or $5 billion) are committed through June 30, 2010 and the remainder for a shorter period of time. Of the $6.7 billion, $6.3 billion constitutes global credit facilities and may be used, at our option, by any of our direct or indirect majority-owned subsidiaries on a guaranteed basis. We also have the ability to transfer, on a non-guaranteed basis, $2 billion of such global credit facilities to Ford Credit and approximately $500 million to FCE Bank plc ("FCE"), Ford Credit's European operation. All of the global credit facilities are free of material adverse change clauses, restrictive financial covenants (for example, debt-to-equity limitations and minimum net worth requirements), and credit rating triggers that could limit our ability to borrow. As discussed under "Outlook" below, we are exploring various Automotive financing strategies, which, if implemented, could impact our global credit facilities.

Financial Services Sector

Ford Credit

Debt and Cash. Ford Credit’s total debt plus securitized off-balance sheet funding was $146.3 billion at September 30, 2006, down $3.7 billion compared with year-end 2005, primarily reflecting repayment of maturing debt offset partially by asset-backed term debt and unsecured debt issuance.

At September 30, 2006, Ford Credit's cash, cash equivalents and marketable securities (excluding marketable securities related to insurance activities) totaled $17.4 billion, compared with $17.9 billion at year-end 2005. In the normal course of its funding activities, Ford Credit may generate more proceeds than are necessary for its immediate funding needs. These excess amounts are maintained primarily as highly liquid investments, which provide liquidity for Ford Credit’s short-term funding needs and give Ford Credit flexibility in the use of its other funding programs. Cash balances to be used only to support Ford Credit's on-balance sheet securitization transactions at September 30, 2006 and December 31, 2005, were approximately $6.8 billion and $2.3 billion, respectively. The increase primarily reflects a larger cash balance in Ford Credit's wholesale securitization trust due to a drop in the wholesale asset balance relative to the level of funding from issued securities (cash replaces wholesale assets backing the securities). In addition, higher levels of securitized assets resulted in an increase in the overall level of cash supporting securitization transactions.

Funding. During the third quarter of 2006, Ford Credit realized proceeds of $7.2 billion from asset-backed funding (including about $1.0 billion from public and private sales of receivables in off-balance sheet securitizations) and about $2.4 billion from unsecured institutional funding.

Term Funding Plan . Ford Credit's present full-year 2006 funding plans are in the range of $16 billion to $20 billion for public funding and $29 billion to $33 billion for private transactions (including whole-loan sale transactions). Through September 30, 2006, Ford Credit had completed $36.5 billion of term debt issuance: $19.3 billion through private transactions (of which $17.7 billion was asset-backed funding and $1.6 billion was unsecured) and $16.2 billion through public transactions (of which $9.9 billion was asset-backed funding, $3.8 billion was unsecured and $2.5 billion was from a debt exchange); and $1.0 billion from a whole-loan sale transaction.

Leverage. Ford Credit uses leverage, or the debt-to-equity ratio, to make various business decisions, including establishing pricing for retail, wholesale and lease financing, and assessing its capital structure. Ford Credit calculates leverage on a financial statement basis and on a managed basis.

The following table illustrates the calculation of Ford Credit’s financial statement leverage (in billions, except for ratios):

	September 30,		December 31,
	2006		2005

Total debt	$	134.5	$	133.4
Total stockholder’s equity		11.8		11.4
Debt-to-equity ratio (to 1)		11.4		11.7

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

The following table illustrates the calculation of Ford Credit’s managed leverage (in billions, except for ratios):

	September 30,			December 31,
	2006			2005

Total debt	$	134.5		$	133.4
Securitized off-balance sheet receivables outstanding		12.9			18.0
Retained interest in securitized off-balance sheet receivables		(1.1	)		(1.4	)
Adjustments for cash and cash equivalents, and marketable securities *		(17.4	)		(17.9	)
Fair value hedge accounting adjustments		(0.2	)		(0.5	)
Total adjusted debt	$	128.7		$	131.6

Total stockholder’s equity (including minority interest)	$	11.8		$	11.4
Fair value hedge accounting adjustments		(0.5	)		(0.7	)
Total adjusted equity	$	11.3		$	10.7

Managed debt-to-equity ratio (to 1)		11.4			12.3

__________

*	Excluding marketable securities related to insurance activities.

For the remainder of 2006, Ford Credit expects its managed leverage to remain at about the current ratio of 11.4 to 1.

Credit Facilities. For additional funding and to maintain liquidity, Ford Credit and its majority-owned subsidiaries, including FCE, have contractually-committed credit facilities with financial institutions that totaled $5.7 billion at September 30, 2006, of which $4.1 billion was available for use. Of the $5.7 billion, $3.3 billion constitutes Ford Credit facilities ($2.7 billion global and about $600 million non-global) and $2.4 billion are FCE facilities ($2.3 billion global and about $100 million non-global). Of the lines available for use, 31% (or $1.3 billion) are committed through June 30, 2010, and the remainder are committed for a shorter period of time. Ford Credit's global credit facilities may be used at its option by any of its direct or indirect majority-owned subsidiaries. FCE's global credit facilities may be used at its option by any of its direct or indirect majority-owned subsidiaries. Ford Credit or FCE, as the case may be, will guarantee any such borrowings. All of the global credit facilities have substantially identical contract terms (other than amounts) and are free of material adverse change clauses, restrictive financial covenants (for example, debt-to-equity limitations and minimum net worth requirements), and credit rating triggers that could limit Ford Credit's ability to borrow. As discussed under "Outlook" below, we are exploring various Automotive financing strategies, which, if implemented, could impact Ford Credit's global credit lines.

Additionally, at September 30, 2006, banks provided $18.9 billion of contractually-committed liquidity facilities exclusively to support Ford Credit's two on-balance sheet, asset-backed commercial paper programs; $18.5 billion supported Ford Credit's FCAR Owner Trust retail securitization program ("FCAR") and $375 million supported the Motown Notes ^SM wholesale securitization program ("Motown Notes"). The FCAR and Motown Notes programs must be supported by liquidity facilities equal to at least 100% and 5%, respectively, of their face amount. At September 30, 2006, $18 billion of FCAR's bank credit facilities were available to support FCAR's asset-backed commercial paper or subordinated debt. The remaining $500 million of available credit lines could be accessed for additional funding if FCAR issued additional subordinated debt. Utilization of these facilities is subject to conditions specific to each program and Ford Credit having a sufficient amount of securitizable assets. At September 30, 2006, the outstanding balances were $16.0 billion for the FCAR program and $5.0 billion for the Motown Notes program.

Committed Purchase Programs. Ford Credit has entered into agreements with several bank-sponsored conduits and other financial institutions pursuant to which such parties are contractually committed to purchase from Ford Credit, at Ford Credit's option, retail receivables and, under certain agreements, wholesale finance receivables or asset-backed securities backed by wholesale finance receivables, for proceeds up to $24.8 billion at September 30, 2006 ($15.1 billion retail and $9.7 billion wholesale). These committed facilities have varying maturity dates through September 2011, with $18.9 billion being ordinarily renewed annually with an original term of 364 days, and the balance having maturities between two and five years. Ford Credit's ability to obtain funding under these commitments is subject to having a sufficient amount of receivables eligible for sale under these programs. At September 30, 2006, $9.1 billion of these commitments were in use. These committed facilities are extremely liquid funding sources as Ford Credit is able to access funds generally within two days. These agreements do not contain restrictive financial covenants (for example, debt-to-equity limitations or minimum net worth requirements), material adverse change clauses, or credit rating triggers that could relieve the purchaser of its purchase commitment. However, the unused portion of the retail commitments may be

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

terminated if the performance of the sold receivables deteriorates beyond specified levels. Similarly, the unused portion of the wholesale commitments may be terminated if the rate at which dealer vehicle inventory is selling declines below certain levels or if there are significant dealer defaults. Based on Ford Credit's experience and knowledge as servicer of the sold assets, Ford Credit does not expect any commitments to be terminated due to these events.

In October 2006, Ford Credit entered into an agreement for a multi-year $6 billion committed facility for unrated asset-backed notes, and year to date, has added $8 billion of additional committed capacity for the securitization of wholesale assets, a significant portion of which is multi-year.

At September 30, 2006, Ford Credit's total cash, cash equivalents, and marketable securities (excluding marketable securities related to insurance activities), together with funding available through credit facilities and committed purchase programs, was $80 billion, of which $71 billion could be utilized (based on the availability of receivables at September 30, 2006 that were eligible for sale under Ford Credit's committed programs) to provide liquidity for all of Ford Credit's short-term funding obligations.

Total Company

Stockholders' Equity. Our stockholders' equity was $9.2 billion at September 30, 2006, down $4.3 billion compared with December 31, 2005. The decrease primarily reflected a net loss from the first nine months of 2006, offset partially by favorable changes in Accumulated o ther comprehensive income/(loss) ("OCI") (see Note 13 of the Notes to the Financial Statements for details of OCI).

Credit Ratings

Our short- and long-term debt is rated by four credit rating agencies designated as nationally recognized statistical rating organizations (" NRSROs ") by the S EC:

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 ").

Ford. In July 2006, DBRS lowered Ford's long-term senior unsecured rating to B (high) from BB (low), maintained the short-term rating at R-4, and maintained the trend at Negative. In July 2006, Moody's lowered Ford's long-term senior unsecured rating to B2 from Ba3, and maintained the outlook at Negative. In August 2006, Fitch lowered Ford's long-term senior unsecured rating to B+ from BB-, and maintained the outlook at Negative. In September 2006, DBRS lowered Ford's long-term senior unsecured rating to B from B (high), lowered Ford's short-term rating to R-5 from R-4 and maintained the trend at Negative. In September 2006, S&P lowered Ford's long-term senior unsecured rating to B from B+, lowered Ford's short-term rating to B-3 from B-2, and maintained the outlook at Negative. In September 2006, Moody's lowered Ford's long-term senior unsecured rating to B3 from B2, and maintained the outlook at Negative. In October 2006, S&P placed Ford's long-term senior unsecured rating on CreditWatch with Negative implications. In October 2006, Fitch placed Ford's long-term senior unsecured debt on Rating Watch Negative. As discussed under "Outlook" below, we are exploring various Automotive financing strategies, which, if implemented, could adversely impact the credit ratings of Ford's unsecured debt.

Ford Credit . In July 2006, DBRS lowered Ford Credit's long-term senior unsecured rating to BB (low) from BB, maintained the short-term rating at R-4 and maintained the trend at Negative. In July 2006, Moody's lowered Ford Credit's long-term senior unsecured rating to Ba3 from Ba2, maintained the short term rating at NP and maintained the outlook at Negative. In August 2006, Fitch lowered Ford Credit's long-term senior unsecured rating to BB- from BB, maintained Ford Credit's short-term rating at B and maintained the outlook at Negative. In September 2006, DBRS lowered Ford Credit's long-term senior unsecured rating to B (high) from BB (low), maintained Ford Credit's short-term rating at R-4 and maintained the trend at Negative. In September 2006, S&P lowered Ford Credit's long-term senior unsecured rating to B from B+, lowered Ford Credit's short-term rating to B-3 from B-2 and maintained the outlook at Negative. In September 2006, Moody's lowered Ford Credit's long-term senior unsecured rating to B1 from Ba3, maintained Ford Credit's short-term rating at NP and maintained the outlook at Negative.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

The following chart summarizes our long-term senior unsecured credit ratings, short-term ratings and the outlook assigned by the NRSROs:

Ford

Ford Credit

Long-Term

Short -Term

Outlook/Trend

Long-Term

Short-Term

Outlook/Trend

DBRS

R-5*

Negative

B (high)

R-4*

Negative

Fitch

B+**

N/A

Negative

BB-

Negative

Moody's

N/A

Negative

S&P ***

B**

B-3

Negative

B-3

Negative

_______

In September 2006, DBRS revised their definitions to certain rating categories used to rate commercial paper and other short-term debt instruments resulting in a Ford Credit short-term rating of R-4 in lieu of R-3 (high) and a Ford short-term rating of R-5 in lieu of R-3 (middle). The Ford and Ford Credit rating revision is related to the redefinition of the rating categories and does not reflect a change in the DBRS opinion regarding the credit quality of these debts.

**	Ford's long-term senior unsecured debt ratings are presently under review with negative implications by Fitch and S&P.

***	S&P lowered FCE's long-term debt rating to B+ from BB-, maintaining a one-notch differential between FCE and Ford Credit.

As a result of lower credit ratings, Ford Credit's unsecured borrowing costs have increased and access to unsecured debt markets has become more restricted. In response, Ford Credit has increased its use of securitization and other asset-backed sources of liquidity and will continue to expand and diversify its asset-backed funding by asset class and region. In addition, Ford Credit will continue to participate in the whole-loan market and access unsecured term debt when opportunities exist that are consistent with its funding needs. Further, Ford Credit has various alternative business arrangements for select products and markets that reduce its funding requirements while allowing it to support us. Ford Credit will continue to pursue such arrangements in the future. Over time, Ford Credit likely will need to reduce further the amount of receivables it purchases. A significant reduction in the amount of purchased receivables would reduce ongoing profits, and could adversely affect its ability to support the sale of Ford vehicles.

OFF-BALANCE SHEET ARRANGEMENTS

Special Purpose Entities. At September 30, 2006, the total outstanding principal amount of receivables sold by Ford Credit and held by off-balance sheet securitization entities was $12.9 billion, down $5.1 billion from December 31, 2005. The decrease primarily reflected the impact of U.S. public retail transactions being reported on-balance sheet in the first nine months of 2006. Ford Credit's retained interests in such sold receivables at September 30, 2006 were $1.1 billion, down about $300 million from December 31, 2005.

OUTLOOK

We have set and communicated the following planning assumptions and operational metrics:

Industry Volume (SAAR incl. heavy trucks)	Planning Assumptions		First Nine Months Status		New Full-Year Outlook
U.S. (million units)		17.0		17.2		17.0
Europe (million units)		17.3		17.7		17.7

Operation Metrics		2006 Milestones
Quality		Improved		On track		On track
Market share		Flat to improved		Down		Down
Automotive cost changes (in billions) (a)		Favorable		$1.0		On track
Capital spending (in billions)		About $7		$5.2		On track
Automotive gross cash balance (in billions) (b)		Over $20		$23.6		About $20

__________

(a)	At constant volume, mix and exchange; excluding special items.

(b)	At year end, including cash and cash equivalents, marketable and loaned securities and short-term VEBA.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Our outlook for quality, market share, and Automotive cost changes remains unchanged from last quarter. While we expect Automotive cost changes to be favorable for full-year 2006 and we continue to work toward our goal of $5 billion in annual operating cost reductions in North America by the end of 2008, we anticipate that the impact of lower production volumes through the first half of 2007 will more than offset the benefit of favorable cost changes. Overall, we anticipate that North American production will be down 8 percent to 12 percent for the first six months of 2007 as compared with the same period this year. This reflects the cessation of production of the Ford Taurus and Ford Freestar (in the fourth quarter of 2006 and second quarter of 2007, respectively) which will result in lower fleet and total share through most of next year, and lower truck and sport utility vehicle production. For 2006, we expect that Ford South America and Ford Europe will be profitable on a full-year basis. We anticipate that our restructuring efforts at Ford North America will result in a full-year operating loss, with operating results in the fourth quarter likely to be worse than in the third quarter. We have lowered our full-year outlook for Ford Asia Pacific and Africa to a loss, primarily due to continued segmentation shifts in Australia, and lower industry volumes in Taiwan. Although we anticipate that PAG's fourth quarter results will approach breakeven, we are projecting a full-year loss for this operating segment.

Our current projection of fourth quarter 2006 production for certain segments is as follows (in thousands):

	Fourth Quarter
	Vehicle Unit Production		2006 Over/(Under) 2005
Ford North America		635		(158)
Ford Europe		465		12
PAG		175		4

Pursuant to our accelerated Way Forward plan, we currently anticipate that charges for full-year 2006 special items will range from about $9.5 billion to $10.5 billion, with about $1.4 billion to $2.4 billion of this amount to be recognized during the fourth quarter. Our full-year special items include a charge of about $2.5 billion for Jobs Bank Benefits and related employee separations pursuant to our accelerated Way Forward plan, and about $1.5 billion to $2.0 billion for pension curtailment losses in North America primarily related to execution of the Way Forward plan. Charges for special items reflected in our full-year projection also include the impairment of long-lived assets in our Ford North America segment (about $2.2 billion) and our Jaguar/Land Rover operations (about $1.6 billion) during the third quarter of 2006. We also anticipate charges in a range of about $1.1 billion to $1.4 billion for additional personnel-reduction programs in North America; a range of about $400 million to $600 million for personnel-reduction programs in Europe; and about $300 million for facility-related costs that we recorded in the first quarter of 2006 (primarily related to a fixed asset write-off for our idled St. Louis Assembly Plant). These charges are offset partially by one-time gains of about $200 million, relating to our share of a gain Mazda realized on the transfer of its pension liabilities to the Japanese government, and to a legal settlement relating to social welfare tax liability in South America. We currently expect cash payments during 2006 for special items, including some similar separation expenses recorded in 2005, to be about $1.5 billion.

Our Financial Services sector will be profitable in 2006, though less profitable than in 2005 due to the absence of earnings from Hertz (including the gain on sale) and lower earnings at Ford Credit. The lower earnings at Ford Credit primarily reflect the impact of higher interest rates, lower average receivables in its managed portfolio, and higher depreciation expenses for vehicles subject to operating leases due to market weakness for trucks and sport utility vehicles. We anticipate Ford Credit's managed receivables will be in the range of $145 billion to $150 billion at year-end 2006. To the extent that we do not elect to designate derivatives, changes in interest rates will result in volatility in our results of operations.

Our anticipated year-end Automotive liquidity includes $20 billion of cash (including cash and cash equivalents, marketable and loaned securities and short-term VEBA) and $6 billion of contractually-committed credit facilities, as well as $3 billion in our long-term VEBA that is accessible over time. We also are seeking to raise additional capital through the sale of all or part of Aston Martin and Automobile Protection Corporation. During the fourth quarter and for the near- to medium-term, we expect our operating-related cash flow to be negative by a substantial amount. This primarily reflects significant operating losses in our Automotive sector through 2008, cash expenditures incurred in connection with our restructuring efforts (primarily for personnel reductions), and pension contributions. This also reflects our expectation to continue to invest in new products throughout this period at about the same level we have during the past few years (about $7 billion per year). To fund the substantial negative cash flow we expect to experience over this period and to provide added liquidity to protect against a recession or other unexpected events, we are exploring various Automotive financing strategies, including secured financing involving a substantial portion of our Automotive assets.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

On September 29, 2006, the Financial Accounting Standards Board ("FASB") issued SFAS No. 158, Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans - an amendment of FASB Statements No. 87, 88, 106 and 132(R) , which amends SFAS No. 87 and SFAS No. 106 to require recognition of the over-funded or under-funded status of pension and other postretirement benefit plans on an issuer's balance sheet. See "Accounting Standards Issued but not yet Adopted" for a discussion of the anticipated impact of this change.

Risk Factors

Statements included or incorporated by reference herein may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on expectations, forecasts and assumptions by our management and involve a number of risks, uncertainties, and other factors that could cause actual results to differ materially from those stated, including, without limitation:

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 (e.g., an escalation or expansion of armed conflict in or beyond the Middle East) 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, change in ownership or control of, or alliances entered into by 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, unfavorable capital market conditions, insufficient collateral, greater-than-expected negative operating-related cash flow 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.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

We cannot be certain that any expectation, forecast or assumption made by management in preparing these forward-looking statements will prove accurate, or that any projection will be realized. It is to be expected that there may be differences between projected and actual results. Our forward-looking statements speak only as of the date of their initial issuance, and we do not undertake any obligation to update or revise publicly any forward-looking statement, whether as a result of new information, future events or otherwise. For additional discussion, see "Item 1A. Risk Factors" in our 2005 Form 10-K/A Report.

CRITICAL ACCOUNTING ESTIMATES

OPEB (Retiree Health Care and Life Insurance). We remeasured the U.S. hourly OPEB plan as of July 13, 2006, as a result of the UAW agreement in December 2005 to increase retiree health care cost sharing as part of our overall cost reduction efforts. The remeasurement (including effects of a higher discount rate and recent health care claims experience) reduced our OPEB obligation by about $9 billion. The weighted average discount rate used to determine the benefit obligation was 6.23% (up 50 basis points from the 5.73% used at year-end 2005). As of July 13, 2006, the weighted average initial health care cost trend rate was 6% (down 100 basis points from the 7% used at year-end 2005).

For further discussion regarding the UAW retiree health care cost sharing agreement, see Note 14 of the Notes to the Financial Statements.

ACCOUNTING STANDARDS ISSUED BUT NOT YET ADOPTED

In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements . This standard defines fair value, establishes a framework for measuring fair value in GAAP, and expands disclosures about fair value measurements. SFAS No. 157 does not introduce new requirements for when fair value measures must be used, but focuses on how to measure fair value by establishing a fair value hierarchy to classify the sources of information used to measure fair value. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. Management is assessing the potential impact on present fair value measurement techniques, disclosures, and our financial position.

In September 2006, the FASB issued SFAS No. 158, Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans - an amendment of FASB Statements No. 87, 88, 106, and 132(R) . This standard requires employers that sponsor defined benefit plans to recognize the over-funded or under-funded status of a defined benefit postretirement plan as an asset or liability in its statement of financial position and to recognize changes in that funded status in the year in which the changes occur, through comprehensive income. SFAS No. 158 requires prospective application, and is effective for financial statements issued for fiscal years ending after December 15, 2006. The adoption of SFAS No. 158 is expected to reduce our year-end Stockholders' equity by approximately $15 billion. The actual reduction may differ due to the inherent uncertainty involved with year-end valuation estimates. This accounting change does not affect our results of operations and will not impact our ability to draw on our contractually-committed credit facilities.

In September 2006, the SEC issued Staff Accounting Bulletin ("SAB") No. 108, which provides guidance on quantifying and evaluating the materiality of financial statement misstatements, as well as guidance on correcting errors using a dual approach. When evaluating materiality, registrants should consider the effects of present and prior year misstatements on both the balance sheet and income statement, and also the present year effects on each of adjusting prior year misstatements that were appropriately considered immaterial under the previous approach. SAB No. 108 is effective for fiscal years ending after November 15, 2006; we presently apply this methodology.

In addition, we have not yet adopted SFAS Nos. 155 and 156 or FASB Interpretation No. 48. Both will be discussed in our Quarterly Report on Form 10-Q/A for the periods ended March 31, 2006 and June 30, 2006, respectively.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued)

OTHER FINANCIAL INFORMATION

The interim financial information included in this Quarterly Report on Form 10-Q for the periods ended September 30, 2006 and 2005 has not been audited by PricewaterhouseCoopers LLP ("PwC"). In reviewing such information, PwC has applied limited procedures in accordance with professional standards for reviews of interim financial information. Accordingly, you should restrict your reliance on their reports on such information. PwC is not subject to the liability provisions of Section 11 of the Securities Act of 1933 for their reports on the interim financial information, because such reports do not constitute "reports" or "parts" of the registration statements prepared or certified by PwC within the meaning of Sections 7 and 11 of the Securities Act of 1933.

ITEM 3.

Quantitative and Qualitative Disclosures About Market Risk.

Foreign Currency Risk . Our foreign currency risk sensitivity has increased since December 31, 2005 due to the continued weakening of the U.S. dollar. As the dollar weakens against foreign currencies, the value of our derivative portfolio increases, and thus the adverse impact of a hypothetical 10% rate change on our financial results becomes increasingly significant. As of September 29, 2006, the potential decrease in fair value of our derivative portfolio in response to a hypothetical 10% adverse change in underlying foreign currency exchange rates would be $1.6 billion, compared with $1.3 billion at December 31, 2005.

Commodity Price Risk. There has been no material change to the information reported in "Item 7A. Quantitative and Qualitative Disclosures About Market Risk" in our 2005 Form 10-K/A Report.

Interest Rate Risk. There has been no material change to the information reported in Item 7A of our 2005 Form 10-K/A Report.

Ford Credit's interest rate risk also increased since December 31, 2005. Assuming a hypothetical increase in interest rates of 100 basis points (or 1%) across all maturities, we estimate that such an increase at September 30, 2006 would reduce Ford Credit's pre-tax cash flow by approximately $89 million over the next twelve months, compared with $40 million at December 31, 2005. In reality, rate changes are rarely instantaneous or parallel.

ITEM 4.

Controls and Procedures .

Evaluation of Disclosure Controls and Procedures. As discussed in "Item 9A. Controls and Procedures" of our 2005 Form 10-K/A Report, we identified a material weakness in internal control over financial reporting with respect to the application of the assumption of no ineffectiveness to certain derivative transactions that did not meet the specific criteria set forth in Paragraph 68. As of the date of the filing of our 2005 Form 10-K/A Report, that material weakness has been fully remediated as described in "Item 9A. Controls and Procedures" of our 2005 Form 10-K/A Report.

Alan Mulally, our Chief Executive Officer ("CEO"), and Donat R. Leclair, Jr., our Chief Financial Officer ("CFO"), have performed an evaluation of the Company’s disclosure controls and procedures, as that term is defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of September 30, 2006, and, solely as a result of the existence at that time of the material weakness in internal control over financial reporting described above, each has concluded that our disclosure controls and procedures were ineffective.

In connection with the filing of this Quarterly Report on Form 10-Q for the period ended September 30, 2006, under the direction of our CEO and CFO, we have again evaluated the Company's disclosure controls and procedures, as that term is defined in Rule 13a-15(e) of the Exchange Act and have concluded that, including the remedial actions described in our 2005 Form 10-K/A Report, as of November 14, 2006, our disclosure controls and procedures are effective to ensure that information required to be disclosed in our periodic reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified by the SEC's rules and forms.

Changes in Internal Control over Financial Reporting. Effective September 1, 2006, Alan Mulally was elected President and Chief Executive Officer, and became a member of our Board of Directors.

As a result of the implementation beginning in the third quarter of 2006 of the UAW retiree health care cost sharing agreement discussed in Note 14 of the Notes to the Financial Statements, we have implemented new internal controls with respect to the accounting for recent changes in eligibility and coverage options.

Also during the third quarter, we launched a new accounting system for finished vehicles in North America; going forward, launch of the new system is planned for selected locations outside of North America. We also replaced the legacy accounts payable system at Land Rover during the third quarter.

We implemented a number of changes in internal control in October and November 2006 related to remediation of the material weakness in internal control over financial reporting with respect to accounting for certain hedges of interest rate risk (discussed in the Explanatory Note and in Note 2 of the Notes to the Financial Statements), including the issuance of a corporate directive suspending use of the application of Paragraph 68 of SFAS No. 133, and the de-designation of all derivative transactions to which we previously had applied the exception set forth in Paragraph 68.

PART II. OTHER INFORMATION

ITEM 1.

Legal Proceedings.

Environmental Matters.

California Environmental Action. On September 20, 2006, the California Attorney General filed a complaint in the U.S. District Court for the Northern District of California against Ford, General Motors Corporation, Toyota Motor North America, Honda North America, Inc., DaimlerChrysler and Nissan North America, seeking monetary damages on a joint and several basis for economic and environmental harm to California caused by global warming. The complaint alleges that cars and trucks sold in the United States constitute an environmental public nuisance under federal and California state common law. We believe that this suit is without merit, and we intend to file for dismissal as soon as practicable. Two years ago, eight states (including California) and several other plaintiffs filed a similar environmental public nuisance claim in the U.S. District Court for the Southern District of New York against five public utilities. That case was dismissed on September 15, 2005, when the U.S. District Court for the Southern District of New York concluded that the suit presented non-justiciable political questions. The public utilities case has been appealed to the U.S. Court of Appeals for the Second Circuit.

ITEM 2.

Unregistered Sales of Equity Securities and Use of Proceeds .

During the third quarter of 2006, we purchased shares of our Common Stock as follows:

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
July 1, 2006 through July 31, 2006		1,661,625	$	6.61		0		No publicly announced repurchase program in place
Aug. 1, 2006 through Aug. 30, 2006		2,548,711		7.55		0		No publicly announced repurchase program in place
Sept.1, 2006 through Sept. 30, 2006		1,403,021		8.17		0		No publicly announced repurchase program in place

Total		5,613,357	$	7.42		0

__________

We currently do not have a publicly announced repurchase program in place. Of the 5,613,357 shares purchased, 5,594,593 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. 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 resp ect 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.

ITEM 5.

Other Information.

Governmental Standards

Motor Vehicle Fuel Economy. As previously disclosed, a group of petitioners led by Massachusetts and other states has sought review by the U.S. Supreme Court of a decision by the U.S. Court of Appeals for the District of Columbia Circuit upholding the Environmental Protection Agency's decision not to regulate carbon dioxide emissions from motor vehicles under the federal Clean Air Act. This matter is scheduled to be argued before the Supreme Court on Wednesday, November 29, 2006, and a decision is expected by late June 2007. The Alliance of Automobile Manufacturers ("Alliance"), of which we are a member, is an intervenor in the case and is participating in the briefing in support of the Environmental Protection Agency's decision.

Mobile Source Emissions Control. As previously disclosed, the Alliance had intervened as a defendant in a Pennsylvania citizens' suit that sought to compel the Pennsylvania Department of Environmental Protection ("DEP") to adopt California motor vehicle emission standards (including its greenhouse gas rules). On September 22, 2006, the U.S. District Court for the Eastern District of Pennsylvania dismissed the plaintiff's suit; however, the DEP is now in the process of adopting the California motor vehicle emission standards (including its greenhouse gas rules).

California Global Warming Solutions Act of 2006. On September 27, 2006, the governor of California signed into law the Global Warming Solutions Act of 2006 (better known by its Assembly Bill number "AB32"). This law mandates that statewide greenhouse gas emissions be capped at 1990 levels by the year 2020, which represents a significant reduction from current greenhouse gas levels. It also requires the monitoring and annual reporting of greenhouse gas emissions by all "significant" sources and delegates authority to the California Air Resources Board ("CARB") to develop and implement greenhouse gas emissions reduction measures. Finally, AB32 requires CARB to implement alternative regulations to control mobile sources of greenhouse gas emissions to achieve equivalent or greater reductions if the motor vehicle greenhouse gas emissions rules adopted under Assembly Bill AB1493 do not remain in effect.

Motor Vehicle Safety. As previously disclosed in our 2005 Form 10-K/A Report, various groups have challenged the categorical determination by the National Highway Transportation Safety Administration ("NHTSA") that certain areas of data were granted a presumption of confidentiality under the Transportation Recall Enhancement, Accountability and Documentation ("TREAD") Act early warning reporting requirements. Since that time, the U.S. District Court for the District of Columbia has ruled that, while NHTSA had the authority to make these categorical determinations, NHTSA did not provide adequate public notice and opportunity to comment. NHTSA has decided to address this issue in further rulemaking. Resolution of this litigation may result in the publication of death and injury information that manufacturers have been submitting to NHTSA under the TREAD Act's early warning reporting rules.

ITEM 6.

Exhibits.

Please see exhibit index below.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

			FORD MOTOR COMPANY
			(Registrant)


Date:	November 14, 2006	By:	/s/ Peter J. Daniel
			Peter J. Daniel
			Senior Vice President and Controller

EXHIBIT INDEX

Designation	Description	Method of Filing

Exhibit 3-B	By-Laws as amended through September 14, 2006	Filed with this Report

Exhibit 10.1	Accession Agreement between Ford Motor Company and Alan Mulally as of September 1, 2006	Filed with this Report

Exhibit 10.2	Consulting Agreement between Ford Motor Company and Sir John Bond dated September 13, 2006	Filed with this Report

Exhibit 10-B	Executive Separation Allowance Plan as amended through October 1, 2006 for separations on or after January 1, 1981	Filed with this Report

Exhibit 10-D	Benefit Equalization Plan, as amended as of October 1, 2006	Filed with this Report

Exhibit 10-F	Supplemental Executive Retirement Plan, as amended through October 1, 2006	Filed with this Report

Exhibit 10-G-3	Description of Director Compensation as of July 13, 2006	Filed with this Report

Exhibit 10-J	Non-Employee Directors Life Insurance and Optional Retirement Plan (as amended as of October 1, 2006)	Filed with this Report

Exhibit 10-M	Select Retirement Plan, as amended through October 1, 2006	Filed with this Report

Exhibit 10-N	Deferred Compensation Plan, as amended and restated as of July 12, 2006	Filed with this Report

Exhibit 12	Ford Motor Company and Subsidiaries Calculation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends	Filed with this Report

Exhibit 15	Letter of PricewaterhouseCoopers LLP, Independent Registered Public Accounting Firm, dated November 14, 2006 relating to Financial Information	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

FORD MOTOR COMPANY

By-Laws

As amended through September 14, 2006

BY-LAWS

FORD MOTOR COMPANY

TABLE OF CONTENTS



ARTICLE I - Offices

ARTICLE II - Stockholders
	Section 1.	Annual Meeting
	Section 2.	Special Meetings
	Section 3.	Notice of Meetings
	Section 4.	Quorum
	Section 5.	Organization
	Section 6.	Proxies and Voting
	Section 7.	Stock Lists
	Section 8.	Ratification
	Section 9.	Judges

ARTICLE III - Board of Directors
	Section 1.	Number, Term of Office and Eligibility
	Section 2.	Meetings
	Section 3.	Notice of Meetings
	Section 4.	Quorum and Organization of Meetings
	Section 5.	Powers
	Section 6.	Reliance upon Books, Reports and Records
	Section 7.	Compensation of Directors

ARTICLE IV - Committees
	Section 1.	Committees of the Board of Directors
	Section 2.	Audit Committee
	Section 3.	Compensation Committee
	Section 4.	Environmental and Public Policy Committee
	Section 5.	Finance Committee
	Section 6.	Nominating and Governance Committee
	Section 7.	Other Committees
	Section 8.	Rules and Procedures
	Section 9.	Application of Article

ARTICLE V - Officers
	Section 1.	Officers
	Section 2.	Executive Chairman of the Board of Directors
	Section 3.	Chief Executive Officer
	Section 4.	President
	Section 5.	Vice Chairmen of the Company, Executive Vice Presidents, Group Vice Presidents, Senior Vice Presidents and Vice Presidents
	Section 6.	Treasurer and Assistant Treasurer

	Section 7.	Secretary and Assistant Secretary
	Section 8.	General Counsel
	Section 9.	Controller
	Section 10.	Salaries

ARTICLE VI - Resignations, Removals and Vacancies
	Section 1.	Resignations
	Section 2.	Removals
	Section 3.	Vacancies

ARTICLE VII - Capital Stock - Dividends - Seal
	Section 1.	Certificates of Shares; Uncertificated Shares
	Section 2.	Addresses of Stockholders
	Section 3.	Lost, Destroyed or Stolen Certificate
	Section 4.	Fixing a Record Date
	Section 5.	Regulations
	Section 6.	Corporate Seal

ARTICLE VIII - Execution of Contracts and Other Documents
	Section 1.	Contracts, etc.
	Section 2.	Checks, Drafts, etc.

ARTICLE IX - Fiscal Year

ARTICLE X - Miscellaneous
	Section 1.	Original Stock Ledger
	Section 2.	Notices and Waivers Thereof
	Section 3.	Voting upon Stocks

ARTICLE XI - Amendments

BY-LAWS

FORD MOTOR COMPANY

ARTICLE I

OFFICES

The registered office of the Company shall be in the City of Wilmington, County of New Castle, State of Delaware. The Company may also have an office in the City of Dearborn, State of Michigan, and at such other places as the Board of Directors may from time to time determine or as the business of the Company may require. The books and records of the Company may be kept (except as otherwise provided by law) at the office of the Company in the City of Dearborn, State of Michigan, outside of the State of Delaware, or at such other places as from time to time may be determined by the Board of Directors.

ARTICLE II

STOCKHOLDERS

Section 1. Annual Meeting.

Unless otherwise determined by the Board of Directors, the annual meeting of the stockholders for the purpose of electing directors and of transacting such other business as may come before it shall be held in the City of Detroit, State of Michigan, on the second Thursday of May in each and every year, if not a legal holiday, and if a legal holiday then on the next day not a legal holiday. The Board of Directors shall, by resolution duly adopted, fix the place within the City of Detroit, Michigan, or elsewhere if so determined, the time, and the date (if different from that described above) for the holding of each such meeting. At least twenty (20) days' notice shall be given to each stockholder entitled to vote at such meeting of the place, date and time for the meeting.

Section 2. Special Meetings.

Special meetings of the stockholders shall be held at the office of the Company in the City of Dearborn, State of Michigan, unless otherwise determined by resolution of the stockholders or of the Board of Directors, whenever called in the manner required by law for purposes as to which there are special statutory provisions, and for other purposes whenever called by the Chairman of the Board of Directors or the President, or by resolution of the Board of Directors, and whenever the holders of thirty percent (30%) or more of the total number of outstanding shares of any class of stock the holders of which are entitled to vote on every matter that is to be voted on without regard to class at such meeting shall file with the Secretary a written application for such meeting stating the time and purpose thereof.

Section 3. Notice of Meetings.

Except as otherwise provided by law, at least twenty (20) days' notice of stockholders' meetings stating the time and place and the objects thereof shall be given by the Chairman of the Board of Directors, the President or the Secretary to stockholders of record having voting power in respect of the business to be transacted thereat. No business other than that stated in the notice shall be transacted at any meeting.

Section 4. Quorum.

At any meeting of the stockholders the number of shares the holders of which shall be present or represented by proxy in order to constitute a quorum for, and the votes that shall be necessary for, the transaction of any business shall be as expressly provided in Article FOURTH of the Certificate of Incorporation, as amended. At any meeting of stockholders at which a quorum is not present, the holders of shares entitled to cast a majority of all of the votes (computed, in the case of each share of Class B Stock, as provided in subsection 1.3 of said Article FOURTH) which could be cast at such meeting by the holders of outstanding shares of stock of the Company who are present in person or by proxy and who are entitled to vote on every matter that is to be voted on without regard to class at such meeting may adjourn the meeting from time to time.

Section 5. Organization.

The Chairman of the Board of Directors shall act as chairman of meetings of the stockholders. The Board of Directors may designate any other officer or director of the Company to act as chairman of any meeting in the absence of the Chairman of the Board of Directors, and the Board of Directors may further provide for determining who shall act as chairman of any stockholders meeting in the absence of the Chairman of the Board of Directors and such designee.

The Secretary of the Company shall act as secretary of all meetings of the stockholders, but in the absence of the Secretary the presiding officer may appoint any other person to act as secretary of any meeting.

Section 6. Proxies and Voting.

Every stockholder entitled to vote at any meeting may vote in person or by proxy authorized by an instrument in writing or by a transmission permitted by law filed in accordance with the procedures established for the meeting. No proxy shall be voted after three years from its date unless such proxy provides expressly for a longer period. Shares of the Company’s stock belonging to the Company shall not be voted upon directly or indirectly.

Section 7. Stock Lists.

A complete list of stockholders entitled to vote at any meeting of stockholders shall be prepared, in alphabetical order by class, by the Secretary and shall be open to the examination of any stockholder, at the place where the meeting is to be held, for at least ten days before the meeting and during the whole time of the meeting.

Section 8. Ratification.

Any transaction questioned in any stockholders' derivative suit, or any other suit to enforce alleged rights of the Company or any of its stockholders, on the ground of lack of authority, defective or irregular execution, adverse interest of any director, officer or stockholder, nondisclosure, miscomputation or the application of improper principles or practices of accounting may be approved, ratified and confirmed before or after judgment by the Board of Directors or by the holders of Common Stock and the holders of Class B Stock voting as provided in subsection 1.6 of Article FOURTH of the Certificate of Incorporation, as amended, and, if so approved, ratified or confirmed, shall have the same force and effect as if the questioned transaction had been originally duly authorized, and said approval, ratification or confirmation shall be binding upon the Company and all of its stockholders and shall constitute a bar to any claim or execution of any judgment in respect of such questioned transaction.

Section 9. Judges.

All votes by ballot at any meeting of stockholders shall be conducted by two judges appointed for the purpose either by the directors or by the meeting. The judges shall decide upon the qualifications of voters, count the votes and declare the result.

ARTICLE III

BOARD OF DIRECTORS

Section 1. Number, Term of Office and Eligibility.

Except as provided by the laws of the State of Delaware or by the Certificate of Incorporation, as amended, the business and the property of the Company shall be managed by or under the direction of a Board of not less than ten and not more than twenty directors, the exact number of which shall be fixed from time to time by resolution of the Board. Each director shall be elected annually by ballot by the holders of Common Stock and the holders of Class B Stock voting as provided in subsection 1.6 of Article FOURTH of the Certificate of Incorporation, as amended, at the annual meeting of stockholders, to serve until his or her successor shall have been elected and shall have qualified, except as provided in this Section. No person may be elected or re-elected a director of the Company if at the time of his or her election or re-election he or she shall have attained the age of seventy-two years, and the term of any director who shall have attained such age while serving as a director shall terminate as of the time of the first annual meeting of stockholders following his or her seventy-second birthday; provided, however, that the Board by resolution may waive such age limitation in any year and from year to year with respect to any director or directors.

Section 2. Meetings.

The directors may hold their meetings outside of the State of Delaware, at the office of the Company in the City of Dearborn, State of Michigan, or at such other place as from time to time they may determine.

The annual meeting of the Board of Directors, for the election of officers and the transaction of other business, shall be held at the World Headquarters of the Company in Dearborn, Michigan, on the same day as, and as soon as practicable following, the annual meeting of stockholders, or at such other time or place as shall be determined by the Board of Directors at its regular meeting next preceding said annual meeting of stockholders. No notice of said annual meeting of the Board of Directors shall be required to be given to the directors.

Regular meetings of the Board of Directors may be held at such time and place as shall from time to time be determined by the Board of Directors.

Special meetings of the Board of Directors shall be held whenever called by direction of the Chairman of the Board of Directors or the President or by one-third of the directors then in office.

Section 3. Notice of Meetings.

The Secretary or an Assistant Secretary shall give notice of the time and place of holding of meetings of the Board of Directors (excepting the annual meeting of directors) by mailing such notice not later than during the second day preceding the day on which such meeting is to be held, or by sending a cablegram, facsimile transmission, mailgram, radiogram, telegram or other form of recorded communication containing such notice or delivering such notice personally or by telephone not later than during the first day preceding the day on which such meeting is to be held to each director. Unless otherwise stated in the notice thereof any and all business may be transacted at any meeting.

Section 4. Quorum and Organization of Meetings.

A third of the total number of members of the Board of Directors as constituted from time to time, but in no event less than three, shall constitute a quorum for the transaction of business; but if at any meeting of the Board of Directors, there shall be less than a quorum present, a majority of those present may adjourn the meeting from time to time, and the meeting may be held as adjourned without further notice or waiver. Except as otherwise provided by law or by the Certificate of Incorporation, as amended, or by these By-Laws, a majority of the directors present at any duly constituted meeting may decide any question brought before such meeting.

The Board of Directors shall elect one of its members to be Chairman of the Board of Directors. The Chairman of the Board of Directors shall lead the Board of Directors in fulfilling its responsibilities as set forth in these By-Laws, including its responsibility to oversee the performance of the Company, and shall determine the agenda and perform all other duties and exercise all other powers which are or from time to time may be delegated to him or her by the Board of Directors.

Meetings of the Board of Directors shall be presided over by the Chairman of the Board of Directors, or in his or her absence, by such other person as the Board of Directors may designate or the members present may select.

Section 5. Powers.

In addition to the powers and authorities by these By-Laws expressly conferred upon them, the Board of Directors shall have and may exercise all such powers of the Company and do all such lawful acts and things that are not by statute or by the Certificate of Incorporation, as amended, or by these By-Laws directed or required to be exercised or done by the stockholders. Without prejudice to or limitation of such general powers and any other powers conferred by statute, or by the Certificate of Incorporation, as amended, or by these By-Laws, the Board of Directors shall have the following powers:

(1) To determine, subject to the requirements of law and of Section 5 of Article FOURTH of the Certificate of Incorporation, as amended, what, if any, dividends shall be declared and paid to the stockholders out of net profits, current or accumulated, or out of surplus or other assets of the Company available for dividends.

(2) To fix, and from time to time to vary, the amount of working capital of the Company, and to set aside from time to time out of net profits, current or accumulated, or surplus of the Company such amount or amounts as they in their discretion may deem necessary and proper as, or as a safeguard to the maintenance of, working capital, as a reserve for contingencies, as a reserve for repairs, maintenance, or rehabilitation, or as a reserve for revaluation of profits of the Company or for such other proper purpose as may in the opinion of the directors be in the best interests of the Company; and in their sole discretion to abolish or modify any such provision for working capital or any such reserve, and to credit the amount thereof to net profits, current or accumulated, or to the surplus of the Company.

(3) To purchase, or otherwise acquire for the Company, any business, property, rights or privileges which the Company may at the time be authorized to acquire, at such price or consideration and generally on such terms and conditions as they think fit; and at their discretion to pay therefor either wholly or partly in money, stock, bonds, debentures or other securities of the Company.

(4) To create, make and issue mortgages, bonds, deeds of trust, trust agreements or negotiable or transferable instruments or securities, secured by mortgage or otherwise, and to do every other act and thing necessary to effect the same.

(5) To appoint any person or corporation to accept and hold in trust for the Company any property belonging to the Company, or in which it is interested, or for any other purpose, and to execute such deeds and do all things requisite in relation to any such trust.

(6) To delegate any of the powers of the Board in the course of the business of the Company to any officer, employee or agent, and to appoint any person the agent of the Company, with such powers (including the power to subdelegate) and upon such terms as the Board may think fit.

(7) To remove any officer of the Company with or without cause, and from time to time to devolve the powers and duties of any officer upon any other person for the time being.

(8) To confer upon any officer of the Company the power to appoint, remove and suspend subordinate officers, agents and employees.

(9) To determine who shall be authorized on the Company's behalf, either generally or specifically, to make and sign bills, notes, acceptances, endorsements, checks, releases, receipts, contracts, conveyances, and all other written instruments executed on behalf of the Company.

(10) To make and change regulations, not inconsistent with these By-Laws, for the management of the Company's business and affairs.

(11) To adopt and, unless otherwise provided therein, to amend and repeal, from time to time, a bonus or supplemental compensation plan for employees (including employees who are officers or directors) of the Company or any subsidiary. Power to construe, interpret, administer, modify or suspend such plan shall be vested in the Board of Directors or a committee thereof.

(12) To adopt a retirement plan, or plans, for the purpose of making retirement payments to employees (including employees who are officers or directors) of the Company or of any subsidiary thereof; and to adopt a group insurance plan, or plans, for the purpose of enabling employees (including employees who are officers or directors) of the Company or of any subsidiary thereof to acquire insurance protection; any such retirement plan or insurance plan, unless otherwise provided therein, shall be subject to amendment or revocation by the Board of Directors.

Section 6. Reliance upon Books, Reports and Records.

Each director, each member of any committee designated by the Board of Directors and each officer, in the performance of his or her duties, shall be fully protected in relying in good faith upon the books of account or reports made to the Company by any of its officials, or by an independent certified public accountant, or by an appraiser selected with reasonable care by the Board of Directors or by any such committee, or in relying in good faith upon other records of the Company.

Section 7. Compensation of Directors .

Directors, as such, may receive, pursuant to resolution of the Board of Directors, fixed fees and other compensation for their services as directors, including, without limitation, services as Chairman of the Board of Directors, or members of committees of the directors or as chairmen thereof; provided, however, that nothing herein contained shall be construed to preclude any director from serving the Company in any other capacity and receiving compensation therefor.

ARTICLE IV

COMMITTEES

Section 1. Committees of the Board of Directors.

There are hereby established as committees of the Board of Directors an Audit Committee, a Compensation Committee, an Environmental and Public Policy Committee, a Finance Committee, and a Nominating and Governance Committee, each of which shall have the powers and functions set forth in Sections 2, 3, 4, 5, and 6 hereof, respectively, and such additional powers as may be delegated to it by the Board of Directors. The Board of Directors may from time to time establish additional standing committees or special committees of the Board of Directors, each of which shall have such powers and functions as may be delegated to it by the Board of Directors. The Board of Directors may abolish any committee established by or pursuant to this Section 1 as it may deem advisable. Each such committee shall consist of one or more directors, the exact number being determined from time to time by the Board of Directors; provided, however, that membership on the Audit Committee and on the Compensation Committee shall be limited to directors who are not officers or employees of the Company. Designations of the Chairman and members of each such committee, and, if desired, a Vice Chairman and alternates for members, shall be made by the Board of Directors. Each such committee shall have a secretary who shall be designated by its chairman. A vice chairman of a committee shall act as the chairman of the committee in the absence or disability of the chairman.

Section 2. Audit Committee.

The Audit Committee shall select and engage, on behalf of the Company, independent public accountants to (1) audit the books of account and other corporate records of the Company and (2) perform such other duties as the Committee may from time to time prescribe. The Committee shall transmit financial statements certified by such independent public accountants to the Board of Directors after the close of each fiscal year. The selection of independent public accountants for each fiscal year shall be made in advance of the annual meeting of stockholders in such fiscal year and shall be submitted for ratification or rejection at such meeting. The Committee shall confer with such accountants and review and approve the scope of the audit of the books of account and other corporate records of the Company. The Committee shall have the power to confer with and direct the officers of the Company to the extent necessary to review the internal controls, accounting practices, financial structure and financial reporting of the Company. From time to time the Committee shall report to and advise the Board of Directors concerning the results of its consultation and review and such other matters relating to the internal controls, accounting practices, financial structure and financial reporting of the Company as the Committee believes merit review by the Board of Directors. The Committee also shall perform such other functions and exercise such other powers as may be delegated to it from time to time by the Board of Directors.

Section 3. Compensation Committee.

The Compensation Committee shall fix from time to time the salaries of members of the Board of Directors who are officers or employees of the Company, the President, and of any and all Vice Chairmen of the Company, Executive Vice Presidents, Group Vice Presidents, Senior Vice Presidents and Vice Presidents of the Company. The Committee from time to time shall consider and make recommendations to the Board of Directors, to the Chairman of the Board of Directors and to the President with respect to the management organization of the Company, the nominations or elections of officers of the Company, senior management succession plans and the appointments of such other employees of the Company as shall be referred to the Committee. It also shall perform such functions as may be delegated to it under the provisions of any bonus, supplemental compensation, special compensation or stock option plan of the Company.

Section 4. Environmental and Public Policy Committee.

The Environmental and Public Policy Committee shall review all aspects of the Company's policies and practices that relate to environmental, public policy and corporate citizenship considerations facing the Company worldwide. From time to time the Committee shall report and make recommendations to the Board of Directors concerning the results of its review and such other matters relating to the foregoing matters as the Committee believes merit consideration by the Board of Directors. The Committee also shall perform such other functions and exercise such other powers as may be delegated to it from time to time by the Board of Directors.

Section 5. Finance Committee.

The Finance Committee shall review all aspects of the Company's policies and practices that relate to the management of the financial affairs of the Company, not inconsistent, however, with law or with such specific directions as to the conduct of affairs as shall have been given by the Board of Directors. The Committee shall have the authority to approve capital expenditures related to product programs within the annual product program budget approved by the Board. The Committee shall report periodically to the Board regarding approval of such capital expenditures. The Committee also shall perform such other functions and exercise such other powers as may be delegated to it from time to time by the Board of Directors. From time to time the Committee shall report and make recommendations to the Board of Directors concerning the results of its review and such other matters relating to the foregoing matters as the Committee believes merit consideration by the Board of Directors.

Section 6. Nominating and Governance Committee.

The Nominating and Governance Committee from time to time shall consider and make recommendations to the Board of Directors and to the Chairman of the Board of Directors with respect to the nominations or elections of directors of the Company.

The Committee from time to time shall consider the size, composition, functioning and compensation of the Board of Directors and make recommendations to the Board of Directors with respect to such matters. Prior to the annual meeting of stockholders each year, and prior to any special meeting of stockholders at which a director is to be elected, the Committee shall recommend to the Board of Directors persons proposed to constitute the nominees whose election at such meeting will be recommended by the Board of Directors.

The authority vested in the Committee by this section shall not derogate from the power of individual members of the Board of Directors to recommend or place in nomination persons other than those recommended by the Committee.

The Committee also shall perform such other functions and exercise such other powers as may be delegated to it from time to time by the Board of Directors.

Section 7. Other Committees.

The Board of Directors, or any committee, officer or employee of the Company may establish additional standing committees or special committees to serve in an advisory capacity or in such other capacities as may be permitted by law, by the Certificate of Incorporation and by the By-Laws. The members of any such committee need not be members of the Board of Directors. Any committee established pursuant to this Section 7 may be abolished by the person or body by whom it was established as he, she or it may deem advisable. Each such committee shall consist of two or more members, the exact number being determined from time to time by such person or body. Designations of members of each such committee and, if desired, alternates for members, shall be made by such person or body, at whose will all such members and alternates shall serve. The chairman of each such committee shall be designated by such person or body. Each such committee shall have a secretary who shall be designated by the chairman.

Section 8. Rules and Procedures.

Each committee may fix its own rules and procedures and shall meet at such times and places as may be provided by such rules, by resolution of the committee, or by call of the chairman or vice chairman. Notice of meeting of each committee, other than of regular meetings provided for by its rules or resolutions, shall be given to committee members. The presence of one-third of its members, but not less than two, shall constitute a quorum of any committee, and all questions shall be decided by a majority vote of the members present at the meeting. All action taken at each committee meeting shall be recorded in minutes of the meeting.

Section 9. Application of Article.

Whenever any provision of any other document relating to any committee of the Company named therein shall be in conflict with any provision of this Article IV, the provisions of this Article IV shall govern, except that if such other document shall have been approved by the stockholders, voting as provided in the Certificate of Incorporation, or by the Board of Directors, the provisions of such other document shall govern.

ARTICLE V

OFFICERS

Section 1. Officers.

The officers of the Company shall be an Executive Chairman of the Board of Directors, who shall be chosen from among the directors, a President, and may also include one or more Vice Chairmen of the Company, one or more Executive Vice Presidents, one or more Group Vice Presidents, one or more Senior Vice Presidents, one or more Vice Presidents, a Treasurer, a Controller and a Secretary, each of whom shall be elected by the Board of Directors to hold office until his or her successor shall have been chosen and shall have qualified. The Board of Directors may elect or appoint one or more Assistant Treasurers, one or more Assistant Secretaries, and such other officers as it may deem necessary, or desirable, each of whom shall have such authority, shall perform such duties and shall hold office for such term as may be prescribed by the Board of Directors from time to time. Any person may hold at one time more than one office.

Section 2. Executive Chairman of the Board of Directors.

Subject to the provisions of these By-Laws, the Executive Chairman of the Board of Directors shall have all powers commonly incident to such position or which are or from time to time may be delegated to him or her by the Board of Directors, or which are or may at any time be authorized or required by law.

Section 3. Chief Executive Officer.

Subject to the provisions of these By-Laws and to the direction of the Board of Directors and the Executive Chairman of the Board of Directors, the Chief Executive Officer shall have ultimate authority for decisions relating to the general management and control of the affairs and business of the Company and shall perform all other duties and exercise all other powers commonly incident to the position of Chief Executive Officer or which are or from time to time may be delegated to him or her by the Executive Chairman of the Board of Directors or by the Board of Directors, or which are or may at any time be authorized or required by law. He or she may redelegate from time to time and to the full extent permitted by law, in writing, to officers or employees of the Company any or all of such duties and powers, and any such redelegation may be either general or specific. Whenever he or she so shall delegate any of his or her authority, he or she shall file a copy of the redelegation with the Secretary of the Company.

Section 4. President.

There shall be a President of the Company. Subject to the provisions of these By-Laws and to the direction of the Board of Directors, the Executive Chairman of the Board of Directors and of the Chief Executive Officer, he or she shall have such powers and shall perform such duties as from time to time may be delegated to him or her by the Board of Directors, the Executive Chairman of the Board of Directors or by the Chief Executive Officer, or which are or may at any time be authorized or required by law.

Section 5. Vice Chairmen of the Company, Executive Vice Presidents, Group Vice Presidents, Senior Vice Presidents and Vice Presidents.

Each of the Vice Chairmen of the Company, each of the Executive Vice Presidents, each of the Group Vice Presidents, each of the Senior Vice Presidents and each of the other Vice Presidents shall have such powers and shall perform such duties as may be delegated to him or her by the Board of Directors, by the Executive Chairman of the Board of Directors or by the President.

In addition, the Board of Directors shall designate one of the Vice Chairmen of the Company, Executive Vice Presidents, Group Vice Presidents, Senior Vice Presidents or Vice Presidents as the Chief Financial Officer, who, among his or her other powers and duties, shall provide and maintain, subject to the direction of the Board of Directors and the Finance Committee, financial and accounting controls over the business and affairs of the Company. Such office shall maintain, among others, adequate records of the assets, liabilities and financial transactions of the Company, and shall direct the preparation of financial statements, reports and analyses. The Chief Financial Officer shall perform such other duties and exercise such other powers as are incident to such functions, subject to the control of the Board of Directors.

Section 6. Treasurer and Assistant Treasurer.

The Treasurer, subject to the direction of the Board of Directors, shall have the care and custody of all funds and securities which may come into his or her hands. When necessary or proper he or she shall endorse on behalf of the Company, for collection, checks, notes and other obligations, and shall deposit all funds of the Company in such banks or other depositaries as may be designated by the Board of Directors or by such officers or employees as may be authorized by the Board of Directors so to designate. He or she shall perform all acts incident to the office of Treasurer, subject to the control of the Board of Directors. He or she may be required to give a bond for the faithful discharge of his or her duties, in such sum and upon such conditions as the Board of Directors may require.

At the request of the Treasurer, any Assistant Treasurer, in the case of the absence or inability to act of the Treasurer, temporarily may act in his or her place. In the case of the death of the Treasurer, or in the case of his or her absence or inability to act without having designated an Assistant Treasurer to act temporarily in his or her place, the Assistant Treasurer so to perform the duties of the Treasurer shall be designated by the Executive Chairman of the Board of Directors, the President, a Vice Chairman of the Company or an Executive Vice President.

Section 7. Secretary and Assistant Secretary.

The Secretary shall keep the minutes of the meetings of the stockholders and of the Board of Directors, and, when required, the minutes of meetings of the committees, and shall be responsible for the custody of all such minutes. Subject to the direction of the Board of Directors, the Secretary shall have custody of the stock ledgers and documents of the Company. He or she shall have custody of the corporate seal and shall affix and attest such seal to any instrument whose execution under seal shall have been duly authorized. He or she shall give notice of meetings and, subject to the direction of the Board of Directors, shall perform all other duties and enjoy all other powers commonly incident to his or her office.

At the request of the Secretary, any Assistant Secretary, in the case of the absence or inability to act of the Secretary, temporarily may act in his or her place. In the case of the death of the Secretary, or in the case of his or her absence or inability to act without having designated an Assistant Secretary to act temporarily in his or her place, the Assistant Secretary or other person so to perform the duties of the Secretary shall be designated by the Executive Chairman of the Board of Directors, the President, a Vice Chairman of the Company or an Executive Vice President.

Section 8. General Counsel.

The Company may have a General Counsel who shall be appointed by the Board of Directors and who shall have general supervision of all matters of a legal nature concerning the Company.

Section 9. Controller.

The Controller shall have such powers and shall perform such duties as may be delegated to him or her by the Board of Directors, the Executive Chairman of the Board of Directors, the President, or the appropriate Vice Chairman of the Company, Executive Vice President, Group Vice President, Senior Vice President or Vice President.

Section 10. Salaries.

Salaries of officers, agents or employees shall be fixed from time to time by the Board of Directors or by such committee or committees, or person or persons, if any, to whom such power shall have been delegated by the Board of Directors. An employment contract, whether with an officer, agent or employee, if expressly approved or specifically authorized by the Board of Directors, may fix a term of employment thereunder; and such contract, if so approved or authorized, shall be valid and binding upon the Company in accordance with the terms thereof, provided that this provision shall not limit or restrict in any way the right of the Company at any time to remove from office, discharge or terminate the employment of any such officer, agent or employee prior to the expiration of the term of employment under any such contract, except that the Company shall not thereby be relieved of any continuing liability for salary or other compensation provided for in such contract.

ARTICLE VI

RESIGNATIONS, REMOVALS AND VACANCIES

Section 1. Resignations.

Any director, officer or agent of the Company, or any member of any committee, may resign at any time by giving written notice to the Board of Directors, to the Chairman of the Board of Directors, to the President or to the Secretary of the Company. Any such resignation shall take effect at the time specified therein, or if the time be not specified therein, then upon receipt thereof. The acceptance of such resignation shall not be necessary to make it effective.

Section 2. Removals.

At any meeting thereof called for the purpose, the holders of Common Stock and the holders of Class B Stock voting as provided in subsection 1.6 of Article FOURTH of the Certificate of Incorporation, as amended, may remove from office or terminate the employment of any director, officer or agent with or without cause; and the Board of Directors, by vote of not less than a majority of the entire Board at any meeting thereof called for the purpose, may, at any time, remove from office or terminate the employment of any officer, agent or member of any committee.

Section 3. Vacancies.

Subject to the last sentence of Section 1 of Article III, any vacancy in the office of any director, officer or agent through death, resignation, removal, disqualification, increase in the number of directors or other cause may be filled by the Board of Directors (in the case of vacancies in the Board, by the affirmative vote of a majority of the directors then in office, even though less than a quorum remains) and the person so elected shall hold office until his or her successor shall have been elected and shall have qualified.

ARTICLE VII

CAPITAL STOCK-DIVIDENDS-SEAL

Section 1. Certificates of Shares; Uncertificated Shares

The shares of capital stock of the Company shall be represented by certificates, provided that the Board of Directors may provide by resolution or resolutions that some or all of any or all classes or series of stock shall be uncertificated shares. Any such resolution shall not apply to shares represented by a certificate until such certificate is surrendered to the Company. Notwithstanding the adoption of such a resolution by the Board of Directors, every holder of stock represented by certificates, and upon request every holder of uncertificated shares, shall be entitled to have a certificate in such form, not inconsistent with the Certificate of Incorporation, as amended, as shall be approved by the Board of Directors. The certificates shall be signed by the Executive Chairman of the Board of Directors, the President, a Vice Chairman of the Company, an Executive Vice President, a Group Vice President, a Senior Vice President or a Vice President, and also by the Treasurer or an Assistant Treasurer, or the Secretary or an Assistant Secretary. Any and all signatures may be facsimiles.

All certificates shall bear the name of the person owning the shares represented thereby, shall state the number of shares represented by such certificate and the date of issue; and such information shall be entered in the Company’s original stock ledger.

Section 2. Addresses of Stockholders.

It shall be the duty of every stockholder to notify the Company of his or her post office address and of any change therein. The latest address furnished by each stockholder shall be entered on the original stock ledger of the Company and the latest address appearing on such original stock ledger shall be deemed conclusively to be the post office address and the last-known post office address of such stockholder. If any stockholder shall fail to notify the Company of his or her post office address, it shall be sufficient to send corporate notices to such stockholder at the address, if any, understood by the Secretary to be his or her post office address, or in the absence of such address, to such stockholder, at the General Post Office in the City of Wilmington, State of Delaware.

Section 3. Lost, Destroyed or Stolen Certificate.

Any person claiming a stock certificate in lieu of one lost, destroyed or stolen, shall give the Company an affidavit as to his, her or its ownership of the certificate and of the facts which go to prove that it has been lost, destroyed or stolen. If required by the Board of Directors, he, she or it also shall give the Company a bond, in such form as may be approved by the Board of Directors, sufficient to indemnify the Company against any claim that may be made against it on account of the alleged loss of the certificate or the issuance of a new certificate.

Section 4. Fixing a Record Date.

The Board of Directors may fix in advance a date not exceeding (i) sixty (60) days preceding the date of any meeting of stockholders, or the date for payment of any dividend, or the date for the allotment of rights, or the date when any change or conversion or exchange of stock shall go into effect (other than conversions or exchanges pursuant to Sections 2, 3 or 4 of Article FOURTH of the Certificate of Incorporation, as amended), as a record date for the determination of the stockholders entitled to notice of and to vote at any such meeting and any adjournment thereof, or entitled to payment of any such dividend or to any such allotment of rights or to exercise the rights in respect of any such change, or conversion or exchange of stock (other than conversions or exchanges pursuant to Sections 2, 3 or 4 of Article FOURTH of the Certificate of Incorporation, as amended), or (ii), ten (10) days after adoption of the resolution fixing such date, as a record date for the determination of the stockholders entitled to consent in writing to corporate action; and in any such case, such stockholders and only such stockholders, as shall be stockholders of record on the date so fixed, shall be entitled, subject to the provisions of Article FOURTH of the Certificate of Incorporation, as amended, to such notice of and to vote at such meeting and any adjournment thereof or to receive payment of such dividend or to receive such allotment of rights or to exercise such rights or to give such consent, as the case may be, notwithstanding any transfer of any stock on the books of the Company after such record date.

Section 5. Regulations.

The Board of Directors shall have power and authority to make all such rules and regulations not inconsistent with any of the provisions of Sections 2, 3, 4 or 5 of Article FOURTH of the Certificate of Incorporation, as amended, as it may deem expedient, concerning the issue, transfer and registration of certificates for shares of the stock of the Company.

Section 6. Corporate Seal.

The corporate seal shall have inscribed thereon the name of the Company, the year of its organization, and the words "Corporate Seal" and "Delaware." If and when so authorized by the Board of Directors, a duplicate of the seal may be kept and used by the Secretary or Treasurer or by any Assistant Secretary or Assistant Treasurer.

ARTICLE VIII

EXECUTION OF CONTRACTS AND OTHER DOCUMENTS

Section 1. Contracts, etc.

Except as otherwise prescribed in these By-Laws, such officers, employees or agents of the Company as shall be specified by the Board of Directors shall sign, in the name and on behalf of the Company, all deeds, bonds, contracts, mortgages and other instruments or documents, the execution of which shall be authorized by the Board of Directors; and such authority may be general or confined to specific instances. Except as so authorized by the Board of Directors, no officer, agent or employee of the Company shall have power or authority to bind the Company by any contract or engagement or to pledge, mortgage, sell or otherwise dispose of its credit or any of its property or to render it pecuniarily liable for any purpose or in any amount.

Section 2. Checks, Drafts, etc.

Except as otherwise provided in these By-Laws, all checks, drafts, notes, bonds, bills of exchange or other orders, instruments or obligations for the payment of money shall be signed by such officer or officers, employee or employees, or agent or agents, as the Board of Directors shall by resolution direct. The Board of Directors may, in its discretion, also provide by resolution for the countersignature or registration of any or all such orders, instruments or obligations for the payment of money.

ARTICLE IX

FISCAL YEAR

The fiscal year of the Company shall begin the first day of January in each year.

ARTICLE X

MISCELLANEOUS

Section 1. Original Stock Ledger.

As used in these By-Laws and in the Certificate of Incorporation, as amended, the words "original stock ledger" shall mean the record maintained by the Secretary of the Company of the name and address of each of the holders of shares of any class of stock of the Company, and the number of shares and the numbers of the certificates for such shares held by each of them, taking into account transfers at the time made by and recorded on the transfer sheets of each of the Transfer Agents of the Company although such transfers may not then have been posted in the record maintained by the Secretary.

Section 2. Notices and Waivers Thereof.

Whenever any notice whatever is required by these By-Laws or by the Certificate of Incorporation, as amended, or by any of the laws of the State of Delaware to be given to any stockholder, director or officer, such notice, except as otherwise provided by the laws of the State of Delaware, may be given personally or by telephone or be given by cablegram, facsimile transmission, mailgram, radiogram, telegram or other form of recorded communication, addressed to such stockholder at the address set forth as provided in Section 2 of Article VII, or to such director or officer at his or her Company location, if any, or at such address as appears on the books of the Company, or the notice may be given in writing by depositing the same in a post office, or in a regularly maintained letter box, in a postpaid, sealed wrapper addressed to such stockholder at the address set forth in Section 2 of Article VII, or to such director or officer at his or her Company location, if any, or such address as appears on the books of the Company.

Any notice given by cablegram, mailgram, radiogram or telegram shall be deemed to have been given when it shall have been delivered for transmission. Any notice given by facsimile transmission or other form of recorded communication shall be deemed to have been given when it shall have been transmitted. Any notice given by mail shall be deemed to have been given when it shall have been mailed.

A waiver of any such notice in writing, including by cablegram, facsimile transmission, mailgram or telegram, signed or dispatched by the person entitled to such notice or by his or her duly authorized attorney, whether before or after the time stated therein, shall be deemed equivalent to the notice required to be given, and the presence at any meeting of any person entitled to notice thereof shall be deemed a waiver of such notice as to such person.

Section 3. Voting upon Stocks.

The Board of Directors (whose authorization in this connection shall be necessary in all cases) may from time to time appoint an attorney or attorneys or agent or agents of the Company, or may at any time or from time to time authorize the Executive Chairman of the Board of Directors, the President, any Vice Chairman of the Company, any Executive Vice President, any Group Vice President, any Senior Vice President, any Vice President, the Treasurer or the Secretary to appoint an attorney or attorneys or agent or agents of the Company, in the name and on behalf of the Company, to cast the votes which the Company may be entitled to cast as a stockholder or otherwise in any other corporation or association, any of the stock or securities of which may be held by the Company, at meetings of the holders of the stock or other securities of such other corporation or association, or to consent in writing to any action by any such other corporation or association, and the Board of Directors or any aforesaid officer so authorized may instruct the person or persons so appointed as to the manner of casting such votes or giving such consent, and the Board of Directors or any aforesaid officer so authorized may from time to time authorize the execution and delivery, on behalf of the Company and under its corporate seal, or otherwise, of such written proxies, consents, waivers or other instruments as may be deemed necessary or proper in the premises.

ARTICLE XI

AMENDMENTS

The Board of Directors shall have power to make, alter, amend or repeal the By-Laws of the Company by vote of not less than a majority of the entire Board at any meeting of the Board. The holders of Common Stock and the holders of Class B Stock voting as provided in subsection 1.6 of Article FOURTH of the Certificate of Incorporation, as amended, shall have power to make, alter, amend or repeal the By-Laws at any regular or special meeting, if the substance of such amendment be contained in the notice of such meeting of stockholders.

Exhibit 10.1

William Clay Ford, Jr.

Chairman

Chief Executive Officer

Ford Motor Company

One American Road

Dearborn, Michigan 48126-2798

USA

August 29, 2006

Mr. Alan Mulally

[Address redacted]

Dear Alan,

I am pleased to offer you the position of President and Chief Executive Officer, Ford Motor Company, reporting directly to me. Upon acceptance of this offer you will also become a Board Director. The Board and I believe you have the personal and professional qualifications to make significant contributions to the continued success of Ford Motor Company and that you will be an excellent leader to the organization as we address the challenges and opportunities facing us.

The leading features of your compensation package are summarized below:

·	Base salary of $2,000,000 per year and a 2007 targeted bonus (payable in March 2008) of 175% of base salary. Your March 2007 performance based restricted stock unit and stock option awards will have a minimum value of $6,000,000 and $5,000,000, respectively.

·	A hiring bonus of $7,500,000. This amount will be paid, subject to withholding, within two weeks of the date this agreement is approved by the Board of Directors. You may elect to defer this payment, in whole or in part, into the Deferred Compensation Plan.

In addition, a lump-sum amount of $11,000,000 will be paid, subject to withholding, within two weeks of the date this agreement is approved by the Board of Directors as an offset for forfeited performance and stock option awards in Boeing's long-term incentive plan. You may also elect to defer this amount into the Deferred Compensation Plan.

An initial stock option grant of 3,000,000 stock options with an option price equal to the Fair Market Value (FMV) of Ford Common Stock (average of the high and low trading prices for Ford Motor Company Common Stock trading the regular way on the NYSE) on the date this agreement is approved by the Board of Directors. These would be Non-Qualified stock options with three year vesting - 33% would vest one year from grant date, another 33% after two years from grant date, and the balance of 34% after three years from grant date. The options would have a ten-year term.

-2-

Also effective on the date this agreement is approved by the Board of Directors is a grant of 1,000,000 Non-Qualified performance-based stock options. The option price for these stock options would be the same as for the options described above. Vesting will occur based on the closing price of Ford Common Stock in NYSE trading the regular way reaching certain thresholds that are maintained for at least 30 consecutive trading days as follows: 250,000 stock options shall vest if Ford Common Stock closes at the price of at least $15 per share for 30 consecutive trading days; an additional 250,000 stock options shall vest after Ford Common Stock closes at the price of at least $20 per share for at least 30 consecutive trading days; an additional 250,000 stock options would vest after Ford Common Stock closes at the price of least $25 per share for at least 30 consecutive trading days; and the final 250,000 stock options would vest after Ford Common Stock closes at the price of at least $30 per share for at least 30 consecutive trading days. These stock options would have a five-year term.

A grant of 600,000 Restricted Stock Units effective on the date this agreement is approved by the Board of Directors. Restrictions shall lapse for 200,000 units one year from the effective date; on 200,000 units two years from the effective date; and on 200,000 units three years from the effective date. These Restricted Stock Units would be paid in cash as soon as practicable, following the date the restrictions lapse. These payments could be deferred into the Deferred Compensation Plan if you make the election to defer in the year prior to the restrictions being lifted. Dividend equivalent payments would be made until restrictions lapse, consistent with dividends to common shareholders as determined by the Board of Directors. Final award value would be based on the closing price of Ford Common Stock on the date restrictions lapse.

In the event the Company terminates your employment for reasons other than "for cause" during the first five years of your employment or if there is a Change in Control (as defined in the Appendix) of the Company during the first five years of your employment accompanied by a termination of your employment for Good Reason (as defined in the Appendix) , the Company will pay you two times your annual base salary and targeted bonus and remove vesting requirements for the initial stock option grant of 3,000,000 shares and the 600,000 Restricted Stock Units as severance. Should you leave Ford and accept this severance payment, it is made on the condition that you do not join a competitor for five years after the date of your termination and also sign and deliver an acceptable General Release. You will not be entitled to any severance payment if you are terminated or released at any time "for cause,” as defined in the Appendix.

If you choose to live in temporary housing in Southeast Michigan for the first two years of your employment, we will reimburse you for the costs of temporary living and at the end of the that period, when you relocate your household, you would be eligible for relocation assistance under the Company program.

·	You will be required to use the corporate aircraft for personal travel under the Company's Executive Security Program. When traveling on personal business, you will be entitled to have your wife; children, and guests travel with you, at company expense.

-3-

·	For benefits and pension plan purposes, you will be credited four (4) additional years of service for every year of actual service.

Attached for your information is a summary of the broader range of compensation and benefits related to this offer. Items described in this letter, and the attached summary, are subject to terms, conditions, and requirements of our existing benefit or pension plans and programs. The terms of these benefits or pension plans are programs may be amended from time to time in the future.

This offer of at-will employment is subject to Company’s normal pre-employment requirements, which we have discussed. This offer remains in effect until September 3, 2006. We anticipate that you will start work on or before October 1, 2006.

I am pleased to offer you this opportunity to join the Ford team and look forward to hearing from you by September 3, 2006.

I look forward to your favorable response and assure you of a very warm welcome to Ford.

Sincerely,

/s/ Bill Ford

Bill Ford

I have read the foregoing offer of at-will employment. I agree with, and accept, this offer of employment subject to the terms and conditions detailed above.

Signed:	/s/ Alan Mulally	Date:	September 1, 2006
	Alan Mulally

Exhibit A-1

FOR CAUSE TERMINATION

For purposes of this offer of employment, the term "for cause" shall mean (a) any act of dishonesty or knowing or willful breach of fiduciary duty on your part that is intended to result in your personal enrichment or gain at the expense of Ford or any of its affiliates or subsidiaries; or (b) commission of a felony involving moral turpitude or unlawful, dishonest or unethical conduct that a reasonable person would consider damaging to the reputation or image of Ford; or (c) any material violation of the published standards of conduct applicable to officers or executives of Ford that warrants termination; or (d) insubordination or refusal to perform assigned duties or to comply with the lawful directions of your supervisors; or (e) any deliberate, willful or intentional act that causes substantial harm, loss or injury to Ford.

CHANGE IN CONTROL

" Change in Control " means:

(a) The direct or indirect acquisition by any person of beneficial ownership, through a purchase, merger or other acquisition transaction or series of transactions occurring within a 24 month period, of securities of the Company entitling such person to exercise 50% or more of the combined voting power of the Company’s securities;

(b) The transfer, whether by sale, merger or otherwise, in a single transaction or in a series of transactions occurring within a 12 month period, of all or substantially all of the business and assets of the Company in existence as of the date of this Agreement to any person; or

“ Good Reason ” means the occurrence, without the Executive's express written consent, of any of the following events during the Protected Period (which shall be the two year period beginning as of the date of a Change in Control):

(a) Subject to the provision below on duplication of payments, a reduction of the Executive's base salary as in effect immediately prior to a Change in Control or of such higher base salary as may have been in effect at any time during the Protected Period, except in connection with the termination of the Executive's employment for Cause or on account of Long-Term Disability or death;

(b) Subject to the provision below on duplication of payments, the failure to pay the Executive any portion of his aggregate compensation including, without limitation, annual bonus, long-term incentive and any portion of his compensation deferred under any plan, agreement or arrangement that is payable or has accrued prior to a Change in Control, within thirty days of the date payment of any such compensation is due;

(c) The failure to afford the Executive annual bonus and long-term cash incentive compensation target opportunities at a level which, in the aggregate, is at least equal to 80% of the aggregate level of annual bonus and long-term cash incentive compensation target opportunities made available to the Executive immediately prior to the Change in Control, except in connection with the termination of the Executive’s employment for Cause or on account of Long-Term Disability or death;

(d) A material diminution or change in the responsibilities of the Executive without the Executive's consent, as such responsibilities existed immediately prior to the Change in Control;

(e) Notwithstanding any other provision of this Agreement, the Executive shall have the right to terminate his employment, with such termination being deemed as if a termination for Good Reason during the Protected Period, if any successor to the Company does not assume these obligations upon a Change in Control.

Notwithstanding any provision in this Agreement to the contrary, if the Executive is entitled upon a termination of employment to any change of control related benefits or payments under an employment or other agreement, or a severance plan, the Executive shall not be entitled upon such termination to any duplicative payment or benefits under this Agreement but instead shall receive only the greater payment or benefit, determined on an item by item basis.

Attachment A

Offer Framework

Alan Mulally

President and Chief Executive Officer

1.	First Year Base Compensation
		Base Salary	$2,000,000

		Target Bonus	3,500,000
		(175% of base salary)

		Stock Options	5,000,000

		Performance Based Restricted Stock Units	6,000,000

		2007 Total Compensation Opportunity	$16,500,000


2.	Additional One Time Items
		Stock Option Grant (# Shares)	4,000,000

		Restricted Stock Units (# Shares)	600,000

		Signing Bonus	7,500,000

		Estimated Value of One Time Items	$22,966,666


3.	Replace Forfeited Boeing Long Term Incentive Plan's Performance and Stock Option Awards		$11,000,000

Exhibit 10.2

[Ford Logo]

Peter J. Sherry, Jr.

Secretary

313/323-2130

313/248-8713 (Fax)

psherry@ford.com

One American Road

Room 1134 WHQ

Dearborn, Michigan 48126

September 13, 2006

Sir John Bond

[Address redacted]

Dear Sir John:

This letter will confirm our discussions on the terms of your consultancy to Ford Motor Company:

We have agreed that you will be a consultant to Ford Motor Company and William Clay Ford, Jr., generally spending the whole of the Tuesday and the morning of the Wednesday preceding each of our seven regular Board of Directors meetings in consultation with senior management of Ford Motor Credit Company and senior finance management of Ford.

We will compensate you at the rate of $25,000 per day, which amount would be pro-rated for each Wednesday that you consult with Company management. Accordingly, you would receive $37,500 for each Tuesday/Wednesday that you consult with Company management, or $262,500 per 12 month period. Any additional consulting and resulting compensation would have to be specifically agreed between you and Ford. We will pay you in arrears at the end of each calendar quarter. Of course, we will also reimburse you for normal and customary travel and business expenses incurred by you in providing the consulting services upon submission of appropriate documentation. As a member of the Board of Directors of Ford, you also will continue to receive the fees paid and other benefits provided to non-employee directors.

We will provide you with office, computer and other incidental support when in Dearborn, Michigan.

Either you or Ford can terminate the consulting arrangement at any time, in your or Ford's sole discretion, in which event Ford will pay you for consulting services previously rendered and reimburse you for travel and business expenses previously incurred.

The effective date of our agreement shall be the date of your concurrence, below; however, the Company shall pay you in accordance with this agreement for the time you spent consulting with Ford executives in connection with the July meeting of the Board of Directors.

Your signature, below, will also confirm your resignation from the Compensation Committee and the Nominating and Governance Committee of the Company.

If you concur in the consulting arrangement as described above, please so indicate by signing and dating this letter at the space below.

		Sincerely,


		/s/Peter J. Sherry, Jr.

		Peter J. Sherry, Jr.

Concur:

/s/Sir John Bond
Sir John Bond


Date:	September 13, 2006

Exhibit 10-B

FORD MOTOR COMPANY

Executive Separation Allowance Plan

(As amended through October 1, 2006)

Section 1. Introduction . This Plan has been established for the purpose of providing Leadership Level One or Two Employees who are hired or rehired prior to January 1, 2004 with an Executive Separation Allowance (ESAP) in the event of their separation from employment with the Company under certain circumstances. The Plan is an expression of the Company's present policy with respect to separation allowances for Leadership Level One or Two Employees who meet the eligibility requirements set forth below; it is not a part of any contract of employment and no employee or other person shall have any legal or other right to any Executive Separation Allowance.

Section 2. Definitions . As used in the Plan, the following terms shall have the following meanings, respectively:

" Affiliate " shall mean, as applied with respect to any person or legal entity specified, a person or legal entity that directly or indirectly, through one or more intermediaries, controls or is controlled by, or is under common control with, the person or legal entity specified.

" Company " shall mean Ford Motor Company and such of the subsidiaries of Ford Motor Company as, with the consent of Ford Motor Company, shall have adopted this Plan.

" Contributory Service " shall mean, without duplication, the years and any fractional year of contributory service at retirement, not exceeding one year for any calendar year, of the Eligible Leadership Level One or Two Employee under the Ford Motor Company General Retirement Plan.

" Eligible Leadership Level One or Two Employee " shall mean a Leadership Level One or Two Employee who meets the eligibility criteria set forth in Section 3, or for periods prior to January 1, 2000, shall mean an Executive Roll Employee who meets the eligibility criteria set forth in Section 3.

" Eligible Surviving Spouse " shall mean a spouse to whom a Leadership Level One or Two Employee has been married at least one year at the date of the employee's death.

"Internal Revenue Code" or "Code" shall mean the Internal Revenue Code of 1986, as amended from time to time.

" Leadership Level One or Two Employee " shall mean an employee of the Company (but for periods prior to July 1, 1996, excluding a Company employee who is an employee of Jaguar Cars, a division of the Company) who is assigned to the Leadership Level One or Two, or its equivalent, as such term is defined in the Employee Relations Administration Manual as from time to time constituted.

"Separation From Service" shall mean termination from Company employment.

" Service " shall mean an eligible employee's years of service (including fractions of years) used in determining eligibility for an early retirement benefit under the Ford Motor Company General Retirement Plan.

"Specified Employee" shall mean an employee of the Company who is a Key Employee as defined in Code Section 416(i) without regard to paragraph 5 thereof. A Specified Employee shall be identified as of December 31 ^st of each calendar year and shall apply to any Specified Employee who shall incur a Separation From Service in the 12-month period commencing January 1 ^st of the immediately succeeding calendar year. This provision is effective for Specified Employees who incur a Separation From Service on or after January 1, 2005.

" Subsidiary " shall mean, as applied with respect to any person or legal entity specified, (i) a person or legal entity a majority of the voting stock of which is owned or controlled, directly or indirectly, by the person or legal entity specified or (ii) any other type of business organization in which the person or legal entity specified owns or controls, directly or indirectly, a majority interest.

Section 3. Eligibility . Each Leadership Level One or Two Employee who is being separated from employment with the approval of the Company and who:

(1)

has at least five years service at the Leadership Level One or Two level, or its equivalent;

(2)

has at least ten years of contributory membership under the General Retirement Plan;

(3)

is at least 55 years of age; and

(4)

retires from the Company prior to age 65

shall receive an Executive Separation Allowance as provided herein. The Eligible Surviving Spouse of a Leadership Level One or Two Employee who (i) has not separated from employment with the Company, (ii) meets the eligibility conditions set forth in Subsections (1) through (3) of this Section 3, and (iii) dies on or after January 1, 1981 shall be eligible to receive the Executive Separation Allowance that the Eligible Surviving Spouse of a deceased employee would have been eligible to receive if such employee had separated from employment with the approval of the Company and retired on the date of the employee's death.

The eligibility conditions set forth in Subsections (1) and (2) of Section 3 may be waived by the Executive Chairman except in the case of a Leadership Level One or Two Employee who has not separated from employment with the Company.

Section 4. Calculation of Amount .

A. Base Monthly Salary . For purposes of the Plan, the "Base Monthly Salary" of a Leadership Level One or Two Employee shall be the highest monthly base salary rate of such employee during the employee's 12 months of service immediately preceding Separation From Service with the Company, prior to giving effect to any salary reduction agreement pursuant to an employee benefit plan, as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended, (i) to which Code Section 125 or Code Section 402(e)(3), applies or (ii) which provides for the elective deferral of compensation. It shall not include supplemental compensation or any other kind of extra or additional compensation.

B. Amount of Executive Separation Allowance . Subject to any limitation in other provisions of the Plan, the gross monthly amount of the Executive Separation Allowance of an Eligible Leadership Level One or Two Employee under Section 3 above shall be such employee's Base Monthly Salary multiplied by a percentage, not to exceed 60%, equal to the sum of (i) 15%, (ii) five tenths of one percent (.5%) for each month (or fraction thereof) that such employee's age at Separation From Service exceeds 55, not to exceed thirty percent (30%), and (iii) one percent (1%) for each year of such employee's service in excess of 15, prorated for fractions of a year.

The gross amount for any month shall be reduced by any payments paid or payable for such month to the Eligible Leadership Level One or Two Employee, the employee's surviving spouse, contingent annuitant, or other beneficiary under the General Retirement Plan or any other private retirement plan, other than the Supplemental Executive Retirement Plan, to which the Company or its subsidiaries shall have contributed.

Section 5. Payments . Executive Separation Allowance payments to an Eligible Leadership Level One or Two Employee, in the net amount determined in accordance with Section 4B above, shall be made monthly from the Company's general funds commencing on the first day of the month following the date that is the later of the date on which the Eligible Leadership Level One or Two Employee 1) reaches at least age 55 with 10 years of Contributory Service; or 2) has a Separation From Service. Payments to an Eligible Leadership Level One or Two Employee shall cease at the end of the month in which such employee attains age 65 or dies, whichever occurs first. In the event of death of an Eligible Leadership Level One or Two Employee prior to such employee attaining age 65, or in the event of death on or after January 1, 1981 of a Leadership Level One or Two Employee whose Eligible Surviving Spouse meets the eligibility conditions set forth in Section 3 for payments hereunder, payments shall be made to such employee's Eligible Surviving Spouse, if any, until the death of such spouse or, if earlier, until the end of the month in which the Leadership Level One or Two Employee would have attained age 65.

Anything herein contained to the contrary notwithstanding, the right of any Eligible Leadership Level One or Two Employee to receive an installment of Executive Separation Allowance hereunder for any month shall be payable only if:

(i)

During the entire period from the date of such employee's Separation From Service to the end of such month, such employee shall have earned out such installment by refraining from engaging in any activity that is directly or indirectly in competition with any activity of the Company or any Subsidiary or Affiliate thereof ;

(ii)

If a Specified Employee incurs a Separation From Service, payment of any Executive Separation Allowance benefit accrued or vested after December 31, 2004 shall not commence (or be paid) earlier than the first day of the seventh month following the Separation From Service; and

(iii)

The payments delayed under this Section shall not bear interest.

In the event of an Eligible Leadership Level One or Two Employee's nonfulfillment of the condition set forth in the immediately preceding paragraph, no further installment shall be paid to such employee; provided, however, that the nonfulfillment of such condition may at any time (whether before, at the time of or subsequent to termination of the employee's employment) be waived in the following manner:

(1) with respect to any such employee who at any time shall have been a member of the Board of Directors, a Vice President, the Treasurer, the Controller or the Secretary of the Company, such waiver may be granted by the Compensation Committee upon its determination that in its sole judgment there shall have not been and will not be any substantial adverse effect upon the Company or any Subsidiary or Affiliate thereof by reason of the nonfulfillment of such condition; and

(2) with respect to any other such employee, such waiver may be granted by the Annual Incentive Compensation Committee (or any committee appointed 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 herein contained to the contrary notwithstanding, Executive Separation Allowance payments shall not be paid to or with respect to any person as to whom it has been determined that such person at any time (whether before or subsequent to termination of the employee's employment) acted in a manner inimical to the best interests of the Company. Any such determination shall be made by (i) the Compensation Committee with respect to any Leadership Level One Employee who at any time shall have been a member of the Board of Directors, an Executive Vice President, a Vice President, the Treasurer, the Controller or the Secretary of the Company, and (ii) the Annual Incentive Compensation Committee with respect to any other Leadership Level One or Two Employee, and shall apply to any amounts payable after the date of the applicable Committee's action hereunder, regardless of whether the person has commenced receiving Executive Separation Allowance. Conduct which constitutes engaging in an activity that is directly or indirectly in competition with any activity of the Company or any Subsidiary or Affiliate thereof shall be governed by the four immediately preceding paragraphs of this Section 5 and shall not be subject to any determination under this paragraph.

Any Executive Separation Allowance payments resumed after reemployment with the Company under Section 7A or employment with a Subsidiary of the Company under Section 7B shall be paid on the basis of the percentage of Base Monthly Salary applicable at the time of the initial determination under Section 4B.

Section 6. Deductions . The Company may deduct from any payment of Executive Separation Allowance to an Eligible Leadership Level One or Two Employee or such employee's Eligible Surviving Spouse all amounts owing to it by such employee for any reason, and all taxes required by law or government regulation to be deducted or withheld.

Section 7A. Person Reemployed by the Company . In the event an employee who shall have been separated from employment with the Company under circumstances that would make the employee eligible to receive an Executive Separation Allowance shall be reemployed by the Company before the employee shall have received payment of the full amount of the employee's Executive Separation Allowance, no further allowance shall be paid during such period of reemployment.

Section 7B. Person Employed by a Subsidiary . In the event an employee who shall have been separated from employment with the Company under circumstances that would make the employee eligible to receive an Executive Separation Allowance shall be employed by a Subsidiary of the Company before the employee shall have received payment of the full amount of the employee's Executive Separation Allowance, no further allowance shall be paid during such period of employment.

Section 8. Administration and Interpretation . Except as the committees specified in Section 5 and the Executive Chairman is authorized to administer the Plan in certain respects, the Group Vice President - Corporate Human Resources and Labor Affairs shall have full power and authority on behalf of the Company to administer and interpret the Plan. In the event of a change in a designated officer's title, the officer or officers with functional responsibility for executive separation allowance plans shall have the power and authority to administer and interpret the Plan. All decisions with respect to the administration and interpretation of the Plan shall be final and shall be binding upon all persons.

Section 9. Amendment and Termination. The Company reserves the right to amend, modify or terminate the Plan at any time without notice.

Section 10. Local Payment Authorities. The Vice President and Treasurer and the Assistant Treasurer (or in the event of a change in title, their functional equivalent) may act individually to delegate authority to administrative personnel to make benefit payments to Eligible Leadership Level One or Two Employees in accordance with Plan provisions.

Section 11. Visteon Corporation . The following shall be applicable to employees of Ford who were transferred to Visteon Corporaton on April 1, 2000 ("U.S. Visteon Employees") and who ceased active participation in the Plan as of June 30, 2000 after Visteon Corporation was spun-off from Ford, June 28, 2000.

(a)

Group I and Group II Employees.

and shall receive such benefits as are applicable under the terms of the Plan in effect on the retirement date, based on meeting the minimum Leadership Level required for eligibility for such benefits as of July 1, 2000, service as of July 1, 2000, and the Base Monthly Salary as of the retirement date.

(b)

Group III Employees.

For purposes of this paragraph, a "Group III Employee" shall mean a U.S. Visteon Employee who participated in the GRP prior to July 1, 2000 other than a Group I or Group II Employee. The Plan shall have no liability for any Executive Separation Allowance payable to Group III Employees who were otherwise eligible hereunder with respect to service prior to July 1, 2000 on or after July 1, 2000.

Section 12. Code Section 409A.

With respect to benefits accrued or vested after December 31, 2004, the Company reserves the right to take such action, on a uniform basis, as the Company deems necessary or desirable to ensure compliance with Code Section 409A, and applicable additional regulatory guidance thereunder, or to achieve the goals of the Plan without having adverse tax consequences under this Plan for any employee or beneficiary.

After receipt of Plan benefits accrued or vested after December 31, 2004, the obligations of the Company with respect to such benefits shall be satisfied and no Eligible Leadership Level One or Two Employee, or their Eligible Surviving Spouse, shall have any further claims against the Plan or the Company with respect to Plan benefits accrued or vested after December 31, 2004.

Section 13. Claim for Benefits

Denial of a Claim. A claim for benefits under the plan shall be submitted in writing to the plan administrator. If a claim for benefits or participation is denied in whole or in part by the plan administrator, the Eligible Leadership Level One or Two Employee will receive written notification within a reasonable period from the date the claim for benefits or participation is received. Such notice shall be deemed given upon mailing, full postage prepaid in the United States mail or on the date sent electronically to the Eligible Leadership Level One or Two Employee. If the plan administrator determines that an extensive period of time for processing is required, written notice shall be furnished to the Eligible Leadership Level One or Two Employee as soon as practical.

Review of Denial of the Claim. In the event that the plan administrator denies a claim for benefits or participation, the Eligible Leadership Level One or Two Employee may request a review by filing a written appeal to the Group Vice President - Corporate Human Resources and Labor Affairs, or his or her designee, within sixty (60) days of receipt of the written notification of denial. The appeal will be considered, and a decision shall be rendered as soon as practical. In the event a time extension is needed to consider the appeal and render the decision, written notice shall be provided to the Eligible Leadership One or Two Employee notifying them of such time extension.

Decision on Appeal. The decision on review of the appeal shall be in writing. Such notice shall be deemed given upon mailing, full postage prepaid in the United States mail or on the date sent electronically to the Eligible Leadership Level One or Two Employee. Decisions on the appeal are final and conclusive and are only subject to the arbitrary and capricious standard of judicial review.

Limitations Period. No legal action for benefits under the plan may be brought against the plan until after the claims and appeal procedures have been exhausted. Legal actions under the plan for benefits must be brought no later than two (2) years after the claim arises. No other action may be brought against the plan more than six (6) months after the claim arises.

Exhibit 10-D

FORD MOTOR COMPANY

BENEFIT EQUALIZATION PLAN

(Amended as of October 1, 2006)

Section 1. Purpose.

The purpose of this Plan is to preserve certain benefits of employees under the Company's tax qualified General Retirement Plan, Ford Retirement Plan and Savings and Stock Investment Plan for Salaried Employees by providing appropriate Equalization Benefits under this Plan in place of benefits which cannot be provided under such tax qualified plans because of limitations imposed by Section 415 and Section 401(a)(17) of the Internal Revenue Code of 1986, as amended.

Section 2. Definitions.

As used in this Plan, the following terms shall have the following meanings, respectively:

2.01 "BEP Salary Reductions" shall mean that portion of salary at the basic salary rate which would have been credited to an employee's account before January 1, 1985 pursuant to a salary reduction agreement under paragraph V-2 of the SSIP but which by reason of Code Section 415, exceeds salary reduction contributions that can be made by the Company on an employee's behalf under the Tax-Efficient Savings Program of the SSIP.

2.02 " Company " shall mean Ford Motor Company and such of the subsidiaries of Ford Motor Company as, with the consent of Ford Motor Company, shall have adopted this Plan.

2.03 "Committee" shall mean the Compensation Committee of the Board of Directors of Ford Motor Company

2.04 "Contributory Service" shall have the meaning given that term in the GRP. "Distribution", "account" and "current market value" as used in Section 3.02 of this Plan shall have the meanings given those terms as used in the SSIP.

2.05 "Designated Third Party Administrator" shall be Fidelity Institutional Retirement Services Company or a successor vendor who the Company shall employ to act as record keeper to maintain employee subaccounts and process elections.

2.06 "ERISA " shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time.

2.07 "Ford Retirement Plan" or "FRP" shall mean the Ford Motor Company Retirement Plan, as amended from time to time, for salaried employees of Ford Motor Company and its participating subsidiaries, who are hired or rehired on or after January 1, 2004.

2.08 "General Retirement Plan" or "GRP" shall mean the Ford Motor Company General Retirement Plan for Salaried and Certain Other Employees, as amended from time to time.

2.09 "Internal Revenue Code" or "Code" shall mean the Internal Revenue Code of 1986, as amended from time to time.

2.10 "Limitations" shall mean the limitations on benefits and/or contributions imposed on qualified plans by Code Sections 415 and 401(a)(17).

2.11 "PBGC" shall mean the Pension Benefit Guaranty Corporation.

2.12 "Savings and Stock Investment Plan" or "SSIP" shall mean the Ford Motor Company Savings and Stock Investment Plan for Salaried Employees, as amended from time to time.

2.13 "Separation From Service" shall mean termination from Company employment.

2.14 "Specified Employee" shall mean an employee of the Company who is a Key Employee as defined in Code Section 416(i) without regard to paragraph 5 thereof. A Specified Employee shall be identified as of December 31 ^st of each calendar year and shall apply to any Specified Employee who shall incur a Separation From Service in the 12-month period commencing January 1 ^st of the immediately succeeding calendar year. This provision is effective for Specified Employees who incur a Separation From Service on or after January 1, 2005.

2.15 " Subsidiary " shall mean, as applied with respect to any person or legal entity specified, (i) a person or legal entity with a majority of the voting stock of which is owned or controlled, directly or indirectly, by the person or legal entity specified or (ii) any other type of business organization in which the person or legal entity specified owns or controls, directly or indirectly, a majority interest.

Section 3. Equalization of Benefits.

3.01 GRP Equalization Benefits.

(a)

A Periodic GRP Equalization Benefit shall be provided for and associated with each payment of a GRP benefit that is subject to the Limitations or delayed pursuant to provisions set forth in (b)(iii).

(b)

The Periodic GRP Equalization Benefit:

(i)

Shall be equal in amount to the difference between the GRP benefit and the corresponding benefit that would be payable under the GRP without regard to the Limitations. In determining the amount of the Periodic GRP Equalization Benefit, the member's salary shall be the member's salary (as that term is defined in the GRP) plus BEP Salary Reductions for periods before January 1, 1985 which are credited under this Plan pursuant to Section 3.02(a)(ii)(C) below, but the member shall not make contributions hereunder based on such BEP Salary Reductions.

(ii)

Shall be paid monthly by the Company to the person receiving payment of the corresponding GRP benefit and, for distributions commencing on and after January 1, 2005, shall be paid commencing on the first day of the month following the date that is the later of the date the employee:

Reaches at least age 55 with 10 years of service;

Reaches 30 years of service;

Reaches age 65 or older with one year of service; or

Has a Separation From Service.

(iii)

Notwithstanding any other provision of the Plan to the contrary, if a Specified Employee incurs a Separation From Service from the Company, payment of any Periodic GRP Equalization Benefit accrued or vested after December 31, 2004, shall not commence (or be paid) earlier than the first day of the seventh month following Separation From Service. The payment delayed under this Section shall not bear interest.

(c)

For distributions commencing on or before December 31, 2004, as an alternative to the Periodic GRP Equalization Benefit, the Company and an employee eligible for the Periodic GRP Equalization Benefit under this Section 3.0l may agree on payment of the actuarial equivalent in a lump sum cash payment of such Periodic GRP Equalization Benefit, subject to the following conditions and such other conditions as may be determined by the Executive Vice President and Chief Financial Officer, the Senior Vice President-General Counsel and the Group Vice President-Corporate Human Resources and Labor Affairs:

(i)

The actuarial equivalent shall be determined on the basis of the interest rates and mortality tables, which would be used by the PBGC for determining the present value of liability for pensioners' benefits in the case of a terminated retirement plan under Title IV of ERISA and which are in effect in the month prior to the month when the employee's GRP benefit begins.

(ii)

The agreement must be entered into (A) prior to the year in which the employee's retirement occurs and (B) not later than six months before the actual retirement date; provided, however, that the requirement contained in Subsection (B) immediately above shall not apply to such an agreement entered into in l984 by the Company and an eligible employee who retires before July l, l985.

(iii)

The agreement once entered is irrevocable.

(iv)

Evidence of good health at the time of the agreement will be required.

Payment under such lump sum agreement relating to distributions on or before December 31, 2004 shall be made by the Company as soon as practicable after payment of the GRP benefit begins.

The GRP Equalization Benefits commencing on and after January 1, 2005 shall be made as periodic payments pursuant to Section 3.01(b).

3.02 Savings and Stock Investment Plan Equalization Benefits.

(a)

Pre-1985 Subaccount.

The provisions of this Subsection 3.02(a) shall apply in determining that part of an eligible employee's SSIP Equalization Benefit subaccount based on periods of service until December 31, 1984.

(i)

For an employee who made the election regarding payroll deductions provided in this Subsection, or who elected to have credited under this Plan BEP Salary Reductions, a SSIP Equalization Benefit shall be provided with respect to any class or classes of the SSIP before January 1, 1985 with respect to which Company or employee contributions were subject to the Limitations.

(ii)

If at any time during a plan year ending before January 1, 1985 it appeared that contributions by or on behalf of an employee (including any related Company matching contributions) to the SSIP would be subject to the Limitations, such an employee may have elected to have the Company retain in its general funds and have credited for purposes of computing a member's subaccount of the SSIP Equalization Benefit under this Section 3.02(a):

(A)

by payroll deduction authorization under this Plan that portion of the amount the employee had elected to contribute as employee regular savings contributions to the SSIP for such pay period (by a payroll deduction authorization in effect for such pay period under paragraph IV of the SSIP) which, when added to all other actual and projected Annual Additions as defined under paragraph XXXI of the SSIP during such plan year, exceeded the Limitations.

(B)

that portion of regular savings and related earnings which have been returned to the employee pursuant to the provisions of paragraph XXXI of the SSIP, and

(C)

the employee's BEP Salary Reductions.

(iii)

There has been established for each eligible employee a subaccount for periods of participation under this Section 3.02(a) under the SSIP Equalization Benefit Account. This subaccount shall be equal to the amounts retained by the Company pursuant to Section 3.02(a)(ii) of this Plan adjusted on the basis of investment performance and the member's election as to investment of funds under paragraph VIII and transfer of the value of employee and Company contributions under paragraph IX of the SSIP as though contributions and credits to the member's account hereunder had been so invested less any withdrawals pursuant to Section 3.02(a)(iv) of this Plan; provided, however, that an election by a Company officer of investment in Company common stock shall not apply under this Plan with respect to contributions pursuant to Section 3.02(a)(ii) of this Plan (other than related Company matching contributions) which were made or credited hereunder by or on behalf of such Company officer; and the officer will be required to make any other investment election permitted under paragraph VIII of the SSIP with respect to such amounts.

(iv)

An employee may not withdraw any amounts in excess of the member's regular savings contributions under this Plan and may not borrow against the subaccount of the member's SSIP Equalization Benefit.

(v)

The SSIP Equalization Benefit under this Section 3.02(a) shall be equal to the amount at the time of distribution credited to the employee's subaccount of the SSIP Benefit Equalization Account as determined under Section 3.02(a)(iii) above.

(b)

Post-1984 Subaccount.

The provisions of this Subsection 3.02(b) shall apply in determining an eligible employee's SSIP Equalization Benefit subaccount based on periods of service beginning January l, l985.

(i)

If at any time during a plan year beginning on or after January 1, 1985 contributions by or on behalf of an employee and related Company matching contributions to the SSIP are subject to the Limitations there shall be credited for purposes of computing the eligible employee's SSIP Equalization Benefit under this Section 3.02(b) an amount equal to the Company matching contributions which would have been made under the SSIP based upon the employee's SSIP elections except that such Company matching contributions cannot be made because of the Limitations. For periods on or after October 1, 1995, the Company Matching Contributions shall be made in the form of units in the Ford Stock Fund rather than shares of Ford common stock.

(ii)

There shall be established for each eligible employee a subaccount for periods of participation under this Section 3.02(b) under the SSIP Equalization Benefit Account. For periods prior to May 1, 1996, this subaccount shall be equal to the amounts credited by the Company pursuant to Section 3.02(b)(i) of this Plan adjusted on the basis of investment performance and any election by the member to transfer the value of matured Company matching contributions under paragraph 4.2 of the SSIP, as though credits to the member's account hereunder had been so invested. For periods May 1, 1996 and after, this subaccount shall be equal to the amounts credited by the Company pursuant to Section 3.02(b)(i) of this Plan and adjusted on the basis of investment performance attributable to any separate investment election made by an eligible employee (other than a Company officer) on or after May 1, 1996. The investment options for managing the sub account shall be identical to the investment options specified in Article VIII of the SSIP, although they will have separate fund codes. Any BEP credits earned will be based on the investment options available under Article VIII of the SSIP. The Designated Third Party Administrator will maintain the accounts and process the elections and otherwise be the recordkeeper with respect to this subaccount. Company officers with this subaccount are not eligible to reallocate or transfer credits under the subaccount from the Ford Stock Fund to other investment options, or from other investment options to the Ford Stock Fund.

(iii)

An employee may not withdraw any amounts credited under this Section 3.02(b) and may not borrow against this subaccount of the member's SSIP Equalization Benefit. This subaccount will not accept rollovers from other plans.

(iv)

The SSIP Equalization Benefit under this Section 3.02(b) shall be equal to the amount at the time of distribution credited to the employee's subaccount of the SSIP Benefit Equalization Account as determined under Section 3.02(b)(ii) above.

(v)

In the event of death of an eligible employee with an SSIP Benefit Equalization subaccount, the balance of the subaccount shall be payable to the same beneficiary as the eligible employee has designated under Article XIV of the SSIP unless the eligible employee makes a separate designation under this Plan pursuant to the rules established by the Committee.

(c)

Payment of SSIP Equalization Benefit.

The SSIP Equalization Benefit:

(i)

Shall be paid in a lump sum cash payment by the Company to the employee or, if the employee is deceased, to the employee's beneficiary under the SSIP, and shall be made as soon as practicable after the earlier of death or Separation From Service.

(ii)

Notwithstanding any other provision of the Plan to the contrary, if a Specified Employee incurs a Separation From Service, payment of the amount credited to their SSIP Equalization Benefit sub account, accrued or vested after December 31, 2004 shall be paid no earlier than the first day of the seventh month following Separation From Service. Any distribution delayed under this Section shall not bear interest. Specified Employees will be permitted to continue to manage their investment elections in their sub account during the six-month delay and the Company assumes no responsibility for resulting gains or losses.

3.03

Ford Retirement Plan (FRP) Equalization Benefits

(a)

FRP Subaccount.

The provisions of this Subsection 3.03(a) shall apply in determining an eligible employee's FRP Equalization Benefit for periods of service beginning on or after January 1, 2004.

(i)

The Company shall establish a book entry account for each eligible employee for purposes of computing the employee's FRP Equalization Benefit under this Section 3.03. The eligible employee's FRP Equalization Benefit under this Subsection 3.03(a) shall be equal to the amount(s) credited to the book entry account at the time of distribution.

(ii)

If, at any time during a plan year beginning on or after January 1, 2004, contributions made to the FRP on behalf of an eligible employee are limited due to the application of the Limitations, there shall be credited to the book entry account established for the employee pursuant to this Subsection 3.03(a) an amount equal to the amount of Company contributions that would have been made under the FRP on behalf of the employee but for the application of the Limitations.

(iii)

Each eligible employee's book entry account also will be credited or debited with amounts determined based on investment options selected by the eligible employee under this Subsection 3.03(a)(iii). The investment options available for selection under this Subsection 3.03(a)(iii) shall be identical to the investment options available under the FRP, but will have separate fund codes. Each eligible employee shall select which investment options are to be used in determining the employee's FRP Equalization Benefit. In the absence of an investment selection by an eligible employee, the employee's book entry account will be credited or debited with amounts based on the appropriate Fidelity Freedom Fund offered under the FRP as identified by the Company for the employee. The Designated Third Party Administrator will maintain a record of each book entry account, process investment selections, and otherwise be the record keeper of the book entry accounts. Investment options selected under this Section 3.03 shall be used solely for purposes of determining an eligible employee's FRP Equalization Benefit. An eligible employee's FRP Equalization Benefit will be based on the value of the eligible employee's book entry account as if the amounts in the book entry account had been invested in actual investments selected by the employee; however, no such investments shall be made on behalf of the eligible employee. Eligible employees shall not have voting rights or any other ownership rights with respect to any investment options selected as the measuring mechanism for book entry accounts established under this Section 3.03.

(iv)

Employees may not withdraw or borrow against amounts credited to any book account under this Subsection 3.03(a). Book entry accounts will not accept rollovers from other plans.

(b)	Payment of FRP Equalization Benefit.

The FRP Equalization Benefit:

(i)

Shall be paid in a lump sum cash payment by the Company to the eligible employee or, if the eligible employee is deceased, to the eligible employee's beneficiary under the FRP, and shall be made as soon as practicable after the earlier of the eligible employee's death or Separation From Service. In the event of the death of an eligible employee with a FRP Benefit Equalization book entry account, the balance of the book entry account shall be payable to the same beneficiary as the eligible employee designated under Article XII of the FRP, unless the eligible employee makes a separate designation under this Plan pursuant to the rules established by the Committee.

(ii)

Notwithstanding any other provision of the Plan to the contrary, if a Specified Employee incurs a Separation From Service, payment of any amount credited to the Specified Employee's FRP Equalization Benefit book entry account, accrued or vested after December 31, 2004, shall not be made earlier than the first day of the seventh month following Separation From Service. The FRP Equalization Benefit under this Subsection 3.03(b) shall be equal to the amount credited to the eligible employee's book entry account at the time of distribution as determined under Subsection 3.03(a). Specified Employees will be permitted to continue to manage their book entry accounts during the six-month delay and the Company assumes no responsibility for resulting gains and/or losses.

Section 4. Equalization Benefits Not Funded.

The Company's obligations under this Plan shall not be funded and Equalization Benefits under this Plan shall be payable only out of the general funds of the Company.

Section 5. Amendment, Termination, Etc.

The Board of Directors of the Company shall have the right at any time to amend, modify, discontinue or terminate this Plan in whole or in part; provided, however, that no such action shall deprive any person of an Equalization Benefit under this Plan in respect of any GRP benefit or any SSIP benefit to which the member's rights shall have become vested (under the vesting provisions of the applicable Plans, without regard to any provisions limiting benefits or contributions) prior to the date of such action by the Board of Direc tors.

Section 6. Administration and Interpretation of the Plan.

Full authority to administer and interpret this Plan shall be vested in the Compensation Committee of the Board of Directors of the Company. The Committee is authorized from time to time to establish such rules and regulations as it may deem appropriate for the proper administration of the Plan, and to make such determinations under, and such interpretations of, and to take such steps in connection with, the Plan as it may deem necessary or advisable. Each determination, interpretation, or other action by the Committee shall be in its sole discretion and shall be final, binding and conclusive for all purposes and upon all persons.

References to Articles, Sections or paragraphs of the Code or of the GRP or of the SSIP shall be applicable to any corresponding provision of the Code or of the applicable plans containing essentially the same Limitations, in the event that the applicable Code or plan provisions shall be renumbered.

Section 7. Local Payment Authorities

The Vice President and Treasurer and the Assistant Treasurer (or in the event of a change in title, their functional equivalent) may act individually to delegate authority to administrative personnel to make benefit payments to employees in accordance with plan provisions.

Section 8. Deductions

The Company may deduct from any Benefit Equalization payment to an eligible employee all amounts owing to it by such eligible employee for any reason, and all taxes required by law or government regulation to be deducted or withheld.

Section 9. Visteon Corporation.

The following shall be applicable to employees of Ford who were transferred to Visteon Corporation on April 1, 2000 ("U.S. Visteon Employees") and who ceased active participation in the Plan as of June 30, 2000 after Visteon Corporation was spun-off from Ford, June 28, 2000.

(a)

Group I and Group II Employees

For purposes of this paragraph, a "Group I Employee" shall mean a U.S. Visteon Employee who as of July 1, 2000 was eligible for immediate normal or regular early retirement under the provisions of the GRP as in effect on July 1, 2000. A "Group II Employee" shall mean a U.S. Visteon Employee who (i) was not a Group I Employee; (ii) had as of July 1, 2000 a combination of age and continuous service that equals or exceeds sixty (60) points (partial months disregarded); and (iii) could become eligible for normal or regular early retirement under the provisions of the GRP as in effect on July 1, 2000 within the period after July 1, 2000 equal to the employee's Ford service as of July 1, 2000. A Group I or Group II Employee shall retain eligibility to receive a GRP Equalization Benefit and/or a SSIP Equalization Benefit and shall receive such benefits as are applicable under the terms of the Plan in effect on the retirement date, based on meeting eligibility criteria as of July 1, 2000 with respect to GRP or SSIP participation prior to July 1, 2000 and upon incurring a Separation From Service from Visteon, or from the Company for Group I or II Employees who return to Company employment pursuant to the Visteon Salaried Employee Transition Agreement dated as of October 1, 2005 and any subsequent amendments thereto.

(b)

Group III Employees.

For purposes of this paragraph, a "Group III Employee" shall mean a U.S. Visteon Employee who participated in the GRP prior to July 1, 2000 other than a Group I or Group II Employees. The Plan shall have no liability for a GRP Equalization Benefit and/or a SSIP Equalization Benefit payable to Group III Employees who were otherwise eligible hereunder with respect to GRP or SSIP participation prior to July 1, 2000 on or after July 1, 2000.

Section 10. Code Section 409A.

After receipt of Plan benefits accrued or vested after December 31, 2004, the obligations of the Company with respect to such benefits shall be satisfied and no employee, surviving spouse, or beneficiary shall have any further claims against the Plan or the Company with respect to Plan benefits accrued or vested after December 31, 2004.

Section 11. Claim for Benefits

Denial of a Claim

A claim for benefits under the plan shall be submitted in writing to the plan administrator. If a claim for benefits or participation is denied in whole or in part by the plan administrator, the employee will receive written notification within a reasonable period from the date the claim for benefits or participation is received. Such notice shall be deemed given upon mailing, full postage prepaid in the United States mail or on the date sent electronically to the employee. If the plan administrator determines that an extensive period of time for processing is required, written notice shall be furnished to the employee as soon as practical.

Review of Denial of the Claim to the Committee

In the event that the plan administrator denies a claim for benefits or participation, the employee may request a review by filing a written appeal to the Committee within sixty (60) days of receipt of the written notification of denial. The appeal will be considered at the Committee's next scheduled meeting. Under special circumstances an extension of time for processing may be required in which case a decision shall be rendered as soon as practical. In the event such an extension is needed, written notice shall be provided to the employee.

Decision of the Committee

The decision on review of the appeal shall be in writing. Such notice shall be deemed given upon mailing, full postage prepaid in the United States mail or on the date sent electronically to the retired employee. Decisions of the Committee are final and conclusive and are only subject to the arbitrary and capricious standard of judicial review.

Limitations Period

No legal action for benefits under the plan may be brought against the plan until after the claims and appeal procedures have been exhausted. Legal actions under the plan for benefits must be brought no later than two (2) years after the claim arises. No other action may be brought against the plan more than six (6) months after the claim arises.

Exhibit 10-F

SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

As applicable to retirements of Eligible Executives on or after January 1, 1992 ¹

Amended through October 1, 2006

Section 1. Introduction. On January 1, 1985, the Company established this Plan for the purpose of providing Eligible Executives, hired or rehired prior to January 1, 2004, with a monthly Supplemental Benefit for their lifetime in the event of their retirement from employment with the Company under certain circumstances. The Plan also provides for the award of Conditional Annuities and Pension Parity Benefits to selected Eligible Executives under certain circumstances.

Section 2. Definitions. As used in the Plan, the following terms shall have the following meanings, respectively:

2.01 " Affiliate " shall mean, as applied with respect to any person or legal entity specified, a person or legal entity that directly or indirectly, through one or more intermediaries, controls or is controlled by, or is under common control with, the person or legal entity specified.

2.02 " Annual Incentive Compensation Plan" shall mean the Annual Incentive Compensation Plan of Ford Motor Company, as it may be amended.

2.03 " Committee " shall mean the Compensation Committee of Ford Motor Company.

2.04 " Company " shall mean Ford Motor Company and such of the subsidiaries of Ford Motor Company as, with the consent of Ford Motor Company, shall have adopted this Plan.

2.05 " Credited Service " shall mean, without duplication, the years and any fractional year of credited service at retirement, not exceeding one year for any calendar year, of the Eligible Executive under all the Retirement Plans.

2.06 " Designated Beneficiary " shall mean the beneficiary or beneficiaries designated by an Eligible Executive or Eligible Retired Executive in a writing filed with the Company (subject to such limitations as to the classes and number of beneficiaries and contingent beneficiaries and such other limitations as the Committee may prescribe) to receive, in the event of the death of the Eligible Executive or Eligible Retired Executive, the Death Benefits provided in Section 4.04. An Eligible Executive or Eligible Retired Executive shall be deemed to have designated as beneficiary or beneficiaries under the Plan the person or persons who receive such Eligible Executive's or Eligible Retired Executive's life insurance proceeds under the Company-paid Basic Life Insurance Plan, unless such Eligible Executive or Eligible Retired Executive shall have assigned such life insurance proceeds, in which event the Death Benefits shall be paid to such assignee; provided, however, that if the Eligible Executive or Eligible Retired Executive shall have filed with the Company a written designation of a different beneficiary or beneficiaries under the Plan, such beneficiary form shall control. An Eligible Executive or Eligible Retired Executive may from time to time revoke or change any such designation of beneficiary and any designation of beneficiary under the Plan shall be controlling over any testamentary or other disposition; provided, however, that if the Committee shall be in doubt as to the right of any such beneficiary to receive any payment under the Plan, the same may be paid to the legal representatives of the Eligible Executive or Eligible Retired Executive, in which case the Company, the Committee and the members thereof shall not be under any further liability to anyone.

¹ See Appendix A for provisions applicable to retirements of Eligible Executives on or after January 1, 1985 and prior to January 1, 1992 or retirements of Eligible Executives from certain former Company Affiliates.

2.07 " Eligible Executive " shall mean a person who is the Executive Chairman, Chief Executive Officer, an Executive Vice President, a Group Vice President or a Vice President of the Company (excluding any such person who is an employee of a foreign Affiliate of the Company) or a Company employee in Leadership Level Four or above, or its equivalent, (but for periods prior to July 1, 1996, excluding a Company employee who is an employee of Jaguar Cars, a division of the Company).

2.08 " Eligible Retired Executive " shall mean

(a) with respect to Supplemental Benefits, an Eligible Executive who

(1) retires directly from Company employment (i) on normal or disability retirement or (ii) with the approval of the Company at or after age 55 on early retirement;

(2) will receive a normal, disability or early retirement benefit under one or more Retirement Plans;

(3) has at least ten years of Credited Service without duplication under all Retirement Plans; and

(4) has at least five continuous years of Eligibility Service immediately preceding retirement (unless the eligibility condition set forth in this subparagraph (4) is waived by the Chairman of the Board or the President and Chief Executive Officer).

(b) with respect to Conditional Annuity awards and Pension Parity Benefits, an Eligible Executive (other than an Eligible Executive in Leadership Levels Four through Two or its equivalent) who retires directly from Company employment, (i) on normal or disability retirement or (ii) with the approval of the Company at or after age 55 on early retirement.

2.09 " Eligible Surviving Spouse " shall mean, for purposes of the Pension Parity Surviving Spouse Benefit, a surviving spouse to whom an Eligible Retired Executive has been married at least one year at the date of the Eligible Retired Executive's death.

2.10 " Eligibility Service " shall mean Company service while an Eligible Executive.

2.11 " FE&R " shall mean Ford Electronics and Refrigeration LLC, but for periods prior to February 1, 1999 shall mean Ford Electronics and Refrigeration Corporation.

2.12 " FE&R Retirement Plan " means FE&R Section of the GRP, applicable to salaried employees, as it may be amended.

2.13 " Final Five Year Average Base Salary " means the average of the final five year-end Monthly Base Salaries immediately preceding retirement of the Eligible Retired Executive.

2.14 " Final Three Year Average Base Salary " means the average of the final three year-end Monthly Base Salaries immediately preceding retirement or death of the Eligible Retired Executive.

2.15 " General Retirement Plan " or " GRP " means the Ford Motor Company General Retirement Plan, as it may be amended.

2.16 "Internal Revenue Code" or "Code" shall mean the Internal Revenue Code of 1986, as amended from time to time.

2.17 " Monthly Base Salary " of an Eligible Executive means the monthly base salary paid to such person while an Eligible Executive on December 31, prior to giving effect to any salary reduction agreement pursuant to an employee benefit plan, as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended, (i) to which Code Section 125 or Code Section 402(e)(3) applies or (ii) which provides for the elective deferral of compensation. It does not include supplemental compensation or any other kind of extra or additional compensation.

2.18 "Plan" means the Supplemental Executive Retirement Plan of Ford Motor Company, as amended.

2.19 " Retirement Plans " includes the General Retirement Plan and the FE&R Retirement Plan for periods prior to July 1, 2000.

2.20 "Separation From Service" shall mean termination from Company employment.

2.21 "Specified Employee" shall mean an employee of the Company who is a Key Employee as defined in Code Section 416(i) without regard to paragraph 5 thereof. A Specified Employee shall be identified as of December 31 ^st of each calendar year and shall apply to any Specified Employee who shall incur a Separation From Service in the 12-month period commencing January 1 ^st of the immediately succeeding calendar year. This provision is effective for Specified Employees who incur a Separation From Service on or after January 1, 2005.

2.22 " Subsidiary " shall mean, as applied with respect to any person or legal entity specified, (i) a person or legal entity a majority of the voting stock of which is owned or controlled, directly or indirectly, by the person or legal entity specified or (ii) any other type of business organization in which the person or legal entity specified owns or controls, directly or indirectly, a majority interest .

Section 3. Supplemental Benefits.

3.01 Eligibility. An Eligible Retired Executive shall be eligible to receive a Supplemental Benefit as provided herein.

3.02 Amount of Supplemental Benefit.

(a) Subject to any reductions pursuant to Subsection (b) below and to any limitations and reductions pursuant to other provisions of the Plan, the monthly Supplemental Benefit shall be an amount equal to the Eligible Executive's Final Five Year Average Base Salary multiplied by the Eligible Executive's years of Credited Service at retirement, and further multiplied by the Applicable Percentage based on the Eligible Executive's position or salary grade immediately preceding retirement, as follows:

For retirements on or after January 1, 1992 but prior to August 1, 1995

Status at Retirement	Applicable Percentage

Chairman, Vice Chairman, President		.90%
Executive Vice President		.80%
Vice President		.70%
Non-Vice Presidents
- Salary Grade 21, 20, 19		.60%
- Salary Grade 18, 17, 16		.40%
- Salary Grade 15, 14, 13		.20%

For retirements on or after August 1, 1995 but prior to February 1, 2000

Status at Retirement	Applicable Percentage

Vice President Band
- Chairman, Vice Chairman, President		.90%
- Executive Vice President		.80%
- Group Vice President		.75%
- Vice President		.70%
Non-Vice President
- General Executive Band		.60%
- Executive Band		.40%
- Salary Grade 15, 14, 13		.20%

For retirements on or after February 1, 2000

Status at Retirement	Applicable Percentage

Leadership Level One
- Executive Chairman, Vice Chairman, President		.90%
- Executive Vice President		.80%
- Group Vice President		.75%
- Vice President		.70%


Leadership Level Two ²
- Standard Benefit		.40%
- Non-standard Benefit ³		.60%
Leadership Level Three		.20%
Leadership Level Four		.20%

² General Executive Band Eligible Executives who, on or after January 1, 2000 were reclassified as Leadership Level Two Employees, shall retain their entitlement to the .60% Applicable Percentage regardless of the reclassification.

³ The non-standard benefit will be available for Leadership Level Two Eligible Executives only upon approval of the Executive Chairman , Executive Vice President and Chief Financial Officer and Group Vice President- Corporate Human Resources and Labor Affairs.

(b) For an Eligible Retired Executive who shall retire before age 62 the monthly Supplemental Benefit payable hereunder shall equal the amount calculated in accordance with the immediately preceding Subsection (a) reduced by 5/18 of 1% multiplied by the number of months from the later of the date the Supplemental Benefit commences or age 55 in the case of earlier receipt by reason of disability retirement to the first day of the month after the Eligible Retired Executive would attain age 62.

3.03

Payments.

(a) Subject to the earning-out conditions set forth in Section 6, Supplemental Benefits, in the amount determined under Section 3.02, shall be payable out of the Company's general funds monthly beginning:

(i) on the first day of the month when the Eligible Retired Executive's retirement benefit under any Retirement Plan or under the Company's Executive Separation Allowance Plan begins; or

(ii) for distributions commencing on or after January 1, 2005, on the first day of the month following the date that is the later of the date on which the Eligible Executive:

reaches at least age 55 with 10 years of service; or

has a Separation From Service.

(b) Notwithstanding any other provisions of the Plan to the contrary, if a Specified Employee incurs a Separation From Service, payment of any Supplemental Benefit accrued or vested after December 31, 2004 shall not commence (or be paid) earlier than the first day of the seventh month following the Separation From Service. The payment delayed under this Section shall not bear interest.

(c) Payments to an Eligible Retired Executive hereunder shall cease at the end of the month in which the Eligible Retired Executive dies.

Section 4. Conditional Annuities.

4.01 Eligibility. The Committee may, in its discretion, award to an Eligible Executive (other than an Eligible Executive in Leadership Levels Four through Two or its equivalent) additional retirement income in the form of a Conditional Annuity.

4.02 Amount of Conditional Annuity.

(a) In determining the amount of any Conditional Annuity to be awarded to an Eligible Executive for any year, the Committee shall consider the Company's profit performance and the amount that is awarded to such Eligible Executive for such year under the Annual Incentive Compensation Plan. Awards shall be made only for years in which the Committee has decided, for reasons other than individual or corporate performance or termination of employment, to make an award to an Eligible Executive under the Annual Incentive Compensation Plan which is less than would have been awarded if the historical relationship to awards to other executives had been followed.

(b) The aggregate annual amount payable under the Conditional Annuities awarded to any Eligible Executive shall not exceed an amount equal to the Applicable Percentage of the average of such Eligible Executive's Final Three Year Average Base Salary, determined in accordance with the following table:

	Applicable Percentage
Number of Years for which a Conditional Annuity is awarded	Chairman, Vice Chairman and President		All Other Eligible Executives

1		30%		20%
2		35		25
3		40		30
4		45		35
5 or more		50		40

The percentage shall be reduced pro rata to the extent that service at retirement is less than 30 years.

4.03 Payments.

(a) Subject to the earning-out conditions set forth in Section 6, Conditional Annuities, in the amount determined under Section 4.02, shall be payable to an Eligible Executive out of the Company's general funds monthly beginning:

(i) on the first day of the month when the Eligible Retired Executive's retirement benefit under any Retirement Plan or under the Company's Executive Separation Allowance Plan begins; or

(ii) for distributions commencing on or after January 1, 2005, on the first day of the month following the date that is the later of the date on which the Eligible Executive:

reaches at least age 55 with 10 years of service; or

has a Separation From Service.

(b) Notwithstanding any other provisions of the Plan to the contrary, if a Specified Employee incurs a Separation From Service, payment of any Conditional Annuities accrued or vested after December 31, 2004 shall not commence (or be paid) earlier than the first day of the seventh month following the Separation From Service. The payment delayed under this Section shall not bear interest.

(c) Except as provided in Section 4.04, payments with respect to an Eligible Retired Executive hereunder shall cease at the end of the month in which such Eligible Retired Executive dies.

(d) For an Eligible Executive who retires before age 65, the monthly payment under any Conditional Annuity awarded to such Eligible Executive shall equal the actuarial equivalent (based on factors determined by the Company's independent consulting actuary) of the monthly amount payable for retirement at age 65.

4.04 Death Benefits. Upon death before retirement but at or after age 55, the Eligible Executive's Designated Beneficiary shall be paid a lump sum equal to 30 times (representing 30 months) the aggregate monthly amount payable under such Eligible Executive's Conditional Annuities if the Eligible Executive had been age 55 at death, increased by one-third of one month for each full month by which such Eligible Executive's age at death shall exceed age 55. If death occurs within 120 months following retirement, the monthly payments under the Conditional Annuity shall be continued to the Designated Beneficiary for the remaining balance of the 120 month period following retirement.

Section 5. Pension Parity Benefits.

Section 5.01 Eligibility. For retirements on or after October 1, 1998, an Eligible Retired Executive at Ford Motor Company (U.S.) or Ford Motor Credit Company (U.S.) who held the position of a Vice President or above at Ford Motor Company (U.S.) immediately prior to retirement and who had service with a subsidiary, including an international subsidiary, at any time prior to becoming an employee of Ford Motor Company (U.S.) or Ford Motor Credit Company (U.S.) shall be eligible to receive a Pension Parity Benefit as provided below.

Section 5.02 Amount of Pension Parity Benefit. The monthly Pension Parity Benefit shall be an amount equal to the difference between (i) and (ii), where (i) is the amount of the monthly retirement benefit which would be payable under the GRP, the Executive Separation Allowance Plan ("ESAP"), the Benefit Equalization Plan ("BEP"), and the Select Retirement Plan ("SRP") if all of the Eligible Retired Executive's years of service under the GRP/ESAP/BEP/SRP and each of the subsidiary's retirement plans were counted as years of contributory service under the GRP/ESAP/BEP/SRP and (ii) is the amount of monthly retirement benefit that is or was payable under the GRP/ESAP/BEP/SRP, under the subsidiary's retirement plans, under this Plan as a Supplemental Benefit or a Conditional Annuity, if applicable, or under any other plan sponsored by a subsidiary which provided pension-type benefits (and if such benefits were paid in a lump sum as a termination benefit, this Plan shall convert the lump sum into an actuarial equivalent annuity (as determined by an independent actuary appointed by Ford Motor Company) payable in the same form as the GRP pension payable to the Eligible Retired Executive, or as was otherwise required pursuant to a qualified domestic relations order for purposes of determining the appropriate offset.)

Section 5.03 Pension Parity Surviving Spouse Benefits. An Eligible Surviving Spouse shall be entitled to receive a monthly Pension Parity Surviving Spouse Benefit upon the death of the Eligible Retired Executive in an amount equal to the difference between (i) and (ii), where (i) is the actuarial equivalent (as determined by an independent actuary appointed by Ford Motor Company) of the amount of the monthly survivor's benefit that would be payable under the GRP, the ESAP, the BEP, and the SRP if all of the Eligible Retired Executive's years of service under the GRP/ESAP/BEP/SRP and each of the subsidiary's retirement plans were counted as years of contributory service under the GRP/ESAP/BEP/SRP and (ii) is the actuarial equivalent (under the method described in (i) above) of the amount of the monthly survivor's benefit that is or was payable under the GRP/ESAP/BEP/SRP, under Section 4.04 if the Designated Beneficiary was an Eligible Surviving Spouse, under the subsidiary's retirement plans, or under any other plan sponsored by a subsidiary which provided pension-type survivor benefits.

Section 5.04 Payment.

(a) Subject to the earning-out conditions set forth in Section 6, the Pension Parity Benefit, in the amount determined under Section 5.02 shall be payable to anEligible Executive out of the Company's general funds monthly beginning:

(i) on the first day of the month when the Eligible Retired Executive's retirement benefit under any Retirement Plan or under the ESAP commences; or

(ii) for distributions commencing on or after January 1, 2005, on the first day of the month following the date that is the later of the date on which the Eligible Executive:

reaches at least age 55 with 10 years of service; or

has a Separation From Service

(b) Notwithstanding any other provisions of the Plan to the contrary, if a Specified Employee incurs a Separation From Service, payment of any Pension Parity benefit, accrued or vested after December 31, 2004 shall not commence (or be paid) earlier than the first day of the seventh month following Separation from Service. The payment delayed under this Section shall not bear interest.

(c) Payments to an Eligible Retired Executive hereunder shall cease at the end of the month in which the Eligible Retired Executive dies. The Pension Parity Surviving Spouse Benefit, in the amount determined under Section 5.03, shall be payable out of the Company's general funds monthly beginning on the first day of the month following the Eligible Retired executive's death. Pension Parity Surviving Spouse Benefits paid to an Eligible Surviving Spouse shall cease at the end of the month in which the Eligible Surviving Spouse dies.

Section 5.05 Administration and Interpretation. The Group Vice President -Corporate Human Resources and Labor Affairs and the Executive Vice President and Chief Financial Officer shall have the full power and authority to develop uniform administrative rules and procedures to administer the Pension Parity Benefit and the Pension Parity Surviving Spouse Benefit, and specifically shall have the authority to develop rules to cover specific situations that may require that the Pension Parity Benefit or the Pension Parity Surviving Spouse Benefit to be adjusted to reflect retirement payments from other sources in respect of prior subsidiary service of the Eligible Retired Executive. In the event of a change in the designated officer's title, the officer or officers with functional responsibility for Retirement Plans shall have the power and authority to administer and interpret this Plan.

Section 6. Earning Out Conditions. Anything herein contained to the contrary notwithstanding, the right of any Eligible Retired Executive to receive Supplemental Benefit, Conditional Annuity or Pension Parity payments hereunder for any month shall accrue only if, during the entire period from the date of retirement to the end of such month, the Eligible Retired Executive shall have earned out such payment by refraining from engaging in any activity that is directly or indirectly in competition with any activity of the Company or any Subsidiary or Affiliate thereof.

In the event of an Eligible Retired Executive's nonfulfillment of the condition set forth in the immediately preceding paragraph, no further payment shall be made to the Eligible Retired Executive or the Designated Beneficiary; provided, however, that the nonfulfillment of such condition may at any time (whether before, at the time of or subsequent to termination of employment) be waived in the following manner:

(1) with respect to any such Eligible Retired Executive who at any time shall have been a member of the Board of Directors, an Executive Vice President, a Group Vice President, a Vice President, the Treasurer, the Controller or the Secretary of the Company, 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 or Affiliate thereof by reason of the nonfulfillment of such condition; and

(2) with respect to any other such Eligible Retired Executive, such waiver may be granted by the Annual Incentive Compensation Committee of Ford Motor Company (or any committee appointed 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 herein contained to the contrary notwithstanding, Supplemental Benefit, Conditional Annuity and Pension Parity payments shall not be paid to or with respect to any person as to whom it has been determined that such person at any time (whether before or subsequent to termination of employment) acted in a manner inimical to the best interests of the Company. Any such determination shall be made by (i) the Committee with respect to any Eligible Retired Executive who at any time shall have been a member of the Board of Directors, an Executive Vice President, a Group Vice President, a Vice President, the Treasurer, the Controller or the Secretary of the Company, and (ii) the Annual Incentive Compensation Committee of Ford Motor Company (or any committee appointed for the purpose) with respect to any other Eligible Retired Executive, and shall apply to any amounts payable after the date

of the applicable committee's action hereunder, regardless of whether the Eligible Retired Executive has commenced receiving any benefits hereunder. Conduct which constitutes engaging in an activity that is directly or indirectly in competition with any activity of the Company or any Subsidiary or Affiliate thereof shall be governed by the two immediately preceding paragraphs of this Section 6 and shall not be subject to any determination under this paragraph.

Section 7. General Provisions .

7.01 Administration and Interpretation. An otherwise Eligible Executive's early retirement under the Plan is subject to approval by the Executive Personnel Committee. Except as otherwise provided in the preceding sentence and except as the committees specified in Sections 4 and 6 are authorized to administer the Plan in certain respects, the Group Vice President - Corporate Human Resources and Labor Affairs and the Executive Vice President and Chief Financial Officer shall have full power and authority on behalf of the Company to administer and interpret the Plan. In the event of a change in a designated officer's title, the officer or officers with functional responsibility for Retirement Plans shall have the power and authority to administer and interpret the Plan. All decisions with respect to the administration and interpretation of the Plan shall be final and shall be binding upon all persons.

7.02 Deductions. The Company may deduct from any payment of Supplemental Benefits, Conditional Annuity awards, or Pension Parity Benefits to an Eligible Retired Executive or Pension Parity Surviving Spouse Benefits to an Eligible Surviving Spouse all amounts owing to it by such Eligible Retired Executive or Eligible Surviving Spouse for any reason, and all taxes required by law or government regulation to be deducted or withheld.

7.03 No Contract of Employment. The Plan is an expression of the Company's present policy with respect to Company executives who meet the eligibility requirements set forth herein; it is not a part of any contract of employment. No Eligible Executive, Designated Beneficiary, Eligible Surviving Spouse or any other person shall have any legal or other right to any Supplemental Benefit, Conditional Annuity, Pension Parity Benefit or Pension Parity Surviving Spouse Benefit.

7.04 Governing Law. Except as otherwise provided under federal law, the Plan and all rights thereunder shall be governed, construed and administered in accordance with the laws of the State of Michigan.

7.05 Amendment or Termination. The Company reserves the right to modify or amend, in whole or in part, or to terminate this Plan, at any time without notice.

7.06 Local Payment Authorities. The Vice President and Treasurer and the Assistant Treasurer (or in the event of a change in title, their functional equivalent) may act individually to delegate authority to administrative personnel to make benefit payments to Eligible Retired Executives in accordance with plan provisions.

7.07 Code Section 409A

(a) With respect to benefits accrued or vested after December 31, 2004, the Company reserves the right to take such action, on a uniform basis, as the Company deems necessary or desirable to ensure compliance with Code Section 409A, and applicable additional regulatory guidance thereunder, or to achieve the goals of the Plan without having adverse tax consequences under this Plan for any employee or beneficiary.

(b) After receipt of Plan benefits accrued or vested after December 31, 2004, the obligations of the Company with respect to such benefits shall be satisfied and no Eligible Executive, Eligible Surviving Spouse, or Designated Beneficiary shall have any further claims against the Plan or the Company with respect to Plan benefits accrued or vested after December 31, 2004.

Section 8. Claim for Benefits

8.01 Denial of a Claim. A claim for benefits under the Plan shall be submitted in writing to the plan administrator. If a claim for benefits or participation is denied in whole or in part by the plan administrator, the Eligible Retired Executive will receive written notification within a reasonable period from the date the claim for benefits or participation is received. Such notice shall be deemed given upon mailing, full postage prepaid in the United States mail or on date sent electronically to the Eligible Retired Executive. If the plan administrator determines that an extension of time for processing is required, written notice of the extension shall be furnished to the Eligible Retired Executive as soon as practical.

8.02 Review of Denial of Claim . In the event that the plan administrator denies a claim for benefits or participation, an Eligible Retired Executive may request a review by filing a written appeal to the Group Vice President - Corporate Human Resources and Labor Affairs and the Executive Vice President and Chief Financial Officer, or their designee(s), within sixty (60) days of receipt of the written notification of denial. The appeal will be considered and a decision shall be rendered as soon as practical. In the event an extension of time is needed to consider the appeal and render the decision, written notice shall be provided to the Eligible Retired Executive notifying them of such time extension.

8.03 Decision on Appeal. The decision on review of the appeal shall be in writing. Such notice shall be deemed given upon mailing, full postage prepaid in the United States mail or on the date sent electronically to the Eligible Retired Executive. Decisions rendered on the appeal are final and conclusive and are only subject to the arbitrary and capricious standard of judicial review.

8.04 Limitations Period. No legal action for benefits under the Plan may be brought against the Plan until after the claims and appeal procedures have been exhausted. Legal actions under the Plan for benefits must be brought no later than two (2) years after the claim arises. No other action may be brought against the Plan more than six (6) months after the claim arises.

Appendix A

Applicable to retirements of Eligible Executives on or after January 1, 1985 but prior to January 1, 1992, or retirements of Eligible Executives from certain former Company Affiliates.

Section 1. Definitions . The terms used in this Appendix shall have the same meaning as those in the Supplemental Executive Retirement Plan, except as follows:

1.01 " Contributory Service " shall mean without duplication the years and any fractional year of contributory service at retirement, not exceeding one year for any calendar year, of the Eligible Executive under all Retirement Plans.

1.02 " Eligible Executive " shall mean a person who is the Chairman of the Board and Chief Executive Officer, an Executive Vice President or a Vice President of the Company (excluding any such person who is an employee of a foreign Affiliate of the Company) or a Company employee in Salary Grade 13 or its equivalent or above (Salary Grade 20 or its equivalent or above for Company employees prior to January 1, 1989).

Section 2. Supplemental Benefits .

2.01 Eligibility . An Eligible Retired Executive shall be eligible to receive a Supplemental Benefit as provided herein.

2.02 Amount of Supplemental Benefit .

(1) For those employees who were Eligible Executives on or after January 1, 1989 and retired prior to January 1, 1992, an amount equal to the Eligible Executive's Final Five Year Average Base Salary multiplied by the Eligible Executive's years of Contributory Service at retirement, and further multiplied by the Applicable Percentage based on the Eligible Executive's position or salary grade immediately preceding retirement and on when the Contributory Service occurred, as follows:

Status at Retirement	Applicable Percentage
	Contributory Service before 1/1/89		Contributory Service from 1/1/89
Chairman, Vice Chairman,
President		.60%		.90%
Executive Vice President		.50%		.80%
Vice Presidents
Salary Grade 23		.40%		.70%
Salary Grade 22		.40%		.70%
Salary Grade 21		.40%		.70%
Salary Grade 20		.40%		.70%

Non-Vice Presidents
Salary Grade 21	.30%	.60%
Salary Grade 20	.30%	.60%
Salary Grade 19	.30%	.60%
Salary Grade 18, 17, 16	.20%	.40%
Salary Grade 15, 14, 13	.10%	.20%

(2) For those employees who were Eligible Executives prior to January 1, 1989 and who retired prior to January 1, 1992, the greater of (A) or (B):

(A) the Eligible Executive's Final Five Year Average Base Salary multiplied by the Eligible Executive's Credited Service, and further multiplied by the Applicable Percentage based on the Eligible Executive's position or salary grade immediately preceding retirement, as follows:

Status at Retirement	Applicable Percentage

Chairman, Vice Chairman,
President		.50%
Executive Vice President		.40%
Vice President
Salary Grade 23		.35%
Salary Grade 22		.30%
Salary Grade 21		.25%
Salary Grade 20		.20%
Non-Vice Presidents
Salary Grade 21		.25%
Salary Grade 20		.20%

(B) the Eligible Executive's Final Five Year Average Base Salary multiplied by the Eligible Executive's Contributory Service, and further multiplied by the Applicable Percentage set forth in Section (a)(1) above based on the Eligible Executive's position or salary grade immediately preceding retirement and on when the Contributory Service occurred.

Section 3. Former Affiliates and Former Employees.

3.01 Ford Aerospace Corporation . An employee of Ford Aerospace Corporation who was a Vice President of Ford Motor Company as of April 1, 1985 and retired May 1, 1985 shall be deemed to be an Eligible Executive under the Plan only for Supplemental Benefits and shall be eligible to receive such benefits under the Plan based on Credited Service under the Salaried Retirement Plan of Ford Aerospace Corporation.

3.02 Ford New Holland, Inc . The following shall be applicable to former employees of Ford Tractor Operations who were transferred to Ford New Holland (FNH) and who participated in the General Retirement Plan for service through December 31, 1989 ("FNH Employees").

(a) Retirement-Eligible FNH Employees as of January 1, 1989.

A FNH Employee who was eligible to retire under the General Retirement Plan on or prior to January 1, 1989, and who was in a position equivalent to a Salary Grade 13 or above on December 31, 1989, and who retires directly from FNH shall be deemed to be an Eligible Executive under the Plan only for Supplemental Benefits and shall receive such benefits as are applicable under the terms of the Plan in effect at the date of retirement, if retired prior to January 1, 1992, or the terms of the Plan in effect on January 1, 1992, if retired on or after January 1, 1992; provided, however, that for purposes of calculating the Supplemental Benefit, the Plan shall use (i) the employee's position or salary grade at FNH as of December 31, 1989; (ii) the Final Five Year Average Base Salary immediately preceding retirement of the Eligible Executive from FNH; and (iii) the employee's Credited Service or Contributory Service, as applicable, as of December 31, 1989.

(b) Non-Retirement Eligible Employees as of January 1, 1989.

A FNH Employee who was not eligible to retire under the General Retirement Plan on or prior to January 1, 1989, and who was in a position equivalent to a Salary Grade 13 or above on December 31, 1989, and who retires directly from FNH shall be deemed to be an Eligible Executive under the Plan only for Supplemental Benefits and shall receive such benefits as are applicable under the terms of the Plan in effect as of January 1, 1989; provided, however, that for purposes of calculating the Supplemental Benefit, the Plan shall use (i) the employee's position or salary grade at FNH as of December 31, 1989; (ii) the Final Five Year Average Base Salary as of January 1, 1989; and (iii) the employee's Contributory Service as of December 31, 1989.

3.03 Sale of Favesa Operations to Lear Seating Corporation.

An Eligible Executive whose employment was transferred to Lear Seating Corporation by reason of the sale of a portion of Plastic and Trim Product Division's seat operations to Lear on November 1, 1993 and who was eligible to retire under the terms of the General Retirement Plan as of December 31, 1993, shall retain eligibility to receive a Supplemental Benefit, and shall receive such benefits as are applicable under the terms of the Plan in effect as of December 31, 1993; provided, however that for purposes of calculating the Supplemental Benefit, the Plan shall use (i) the employee's position or salary grade with the Company as of December 31, 1993; (ii) the Final Five Year Average Base Salary as of December 31, 1993; and (iii) the employee's Credited Service as of December 31, 1993.

3.04 Visteon Corporation. The following shall be applicable to employees of Ford who were transferred to Visteon Corporation on April 1, 2000 ("U.S. Visteon Employees") and who ceased active participation in the Plan as of June 30, 2000 after Visteon Corporation was spun-off from Ford, June 28, 2000.

(a)

Group I and Group II Employees.

For purposes of this paragraph, a "Group I Employee" shall mean a U.S. Visteon Employee who as of July 1, 2000 was eligible for immediate normal or regular early retirement under the provisions of the GRP as in effect on July 1, 2000. A "Group II Employee" shall mean a U.S. Visteon Employee who (i) was not a Group I Employee; (ii) had as of July 1, 2000 a combination of age and continuous service that equals or exceeds sixty (60) points (partial months disregarded); and (iii) could become eligible for normal or regular early retirement under the provisions of the GRP as in effect on July 1, 2000 within the period after July 1, 2000 equal to the employee's Ford service as of July 1, 2000. A Group I or Group II Employee shall retain eligibility to receive a Supplemental Benefit and shall receive such benefits as are applicable under the terms of the Plan in effect on the retirement date, based on meeting eligibility criteria as of July 1, 2000 and Credited Service on July 1, 2000 and the Final Five Year Average Base Salary as of the retirement date.

(b)

Group III Employees.

For purposes of this paragraph, a "Group III Employee" shall mean a U.S. Visteon Employee who participated in the GRP prior to July 1, 2000 other than a Group I or Group II Employee. The Plan shall have no liability for any benefits payable to Group III Employees who were otherwise eligible hereunder with respect to Credited Service prior to July 1, 2000 on or after July 1, 2000.

Section 4. General. Except as otherwise provided in this Appendix A, the terms of the Plan applicable to retirements of Eligible Executives on or after January 1, 1992 shall be applicable to the retirements of Eligible Executives on or after January 1, 1985 but prior to January 1, 1992.

Description of Director Compensation

Fees. * Effective as of July 13, 2006, the Board of Directors voluntarily reduced Board fees payable to non-employee directors by half. Since that date, the following fees are paid to directors who are not Ford employees:

Annual Board membership fee	$	100,000
Annual Committee chair fee	$	2,500
Annual Presiding Director fee	$	5,000

Deferred Compensation Plan. Under this plan, $60,000 of a director's annual Board membership fee must be deferred in common stock units. Directors also can choose to have the payment of all or some of the remainder of their fees deferred in the form of cash and/or common stock units. Each common stock unit is equal in value to a share of common stock and is ultimately paid in cash. These common stock units generate Dividend Equivalents in the form of additional common stock units. These units are credited to the directors' accounts on the date any common stock cash dividends are paid. Any fees deferred in cash are held in the general funds of the Company. Interest on fees deferred in cash is credited semi-annually to the directors' accounts at the then-current U.S. Treasury Bill rate plus 0.75%. In general, deferred amounts are not paid until after the director retires from the Board. The amounts are then paid, at the director's option, either in a lump sum or in annual installments over a period of up to ten years.

Restricted Stock Plan. Effective July 1, 2004, Ford amended the Restricted Stock Plan for Non-Employee Directors providing for its termination, except with respect to outstanding grants of restricted stock and stock equivalents. Each non-employee director who had served for six months received 3,496 shares of common stock subject to restrictions on sale. In general, the restrictions expire for 20% of the shares each year following the year of the grant. No new grants of restricted stock will be made under the plan.

Life Insurance. Ford provides non-employee directors with $200,000 of life insurance and $500,000 of accidental death or dismemberment coverage. The life insurance coverage continues after the director retires from the Board if the director is at least 55 years old and has served for at least five years. A director who retires from the Board after age 70 or, after age 55 with Board approval, and who has served for at least five years, may elect to have the life insurance reduced to $100,000 and receive $15,000 a year for life. The accidental death or dismemberment coverage may, at the director's expense, be supplemented up to an additional $500,000 and ends when the director retires from the Board.

Vehicle Evaluation Program. The Company provides directors with the use of company vehicles at an estimated average value for 2005 of approximately $28,000 per director. The directors are expected to provide evaluations of the vehicles to the Company.

* On March 8, 2005, Homer A. Neal, a member of the Board of Directors, joined the board of managers of Ford Global Technologies, LLC, a wholly-owned subsidiary that manages the Company's intellectual property. As a non-employee member of such board, Dr. Neal receives the customary fees paid to non-employee members. Currently, the fees are: Annual Fee: $10,000, Attendance Fee: $1,000 per meeting. Dr. Neal attended two meetings of the board of managers of Ford Global Technologies during 2005.

*On September 13, 2006, the Company entered into a consulting agreement with John R. H. Bond, a member of the Board of Directors of the Company. Under the agreement, Mr. Bond will serve as a consultant and senior advisor to William Clay Ford, Jr., Executive Chairman of the Board, working on financial and other matters. The consulting fee will be $25,000 per day for actual days worked, payable in arrears. The Company contemplates that Mr. Bond will spend approximately one and one-half days adjacent to each of the Company's seven regularly scheduled Board of Directors meetings consulting pursuant to the consulting agreement, and that total fees payable to Mr. Bond will not exceed $262,500 for any twelve month period unless specifically agreed to by the Company and Mr. Bond. Either party may terminate the agreement at any time.

Exhibit 10-J

Ford Motor Company

Directors Life Insurance

and Optional Retirement Plan

(As Amended as of October 1, 2006)

Section 1. Introduction. This Plan has been established for the purpose of providing Eligible Directors, and Eligible Retired Directors, as herein defined, with life insurance and optional retirement benefits under certain circumstances. The Plan is an expression of the Company's present policy with respect to those Company directors and retired directors who meet the eligibility requirements set forth below; it is not a part of any contract of employment and no director or other person shall have any legal or other right to any benefit under the Plan. The Company reserves the right to terminate, amend or modify the Plan, in whole or in part, at any time without notice.

Section 2. Definitions . As used in this Plan:

a. "Board of Directors" or "Board" shall mean the Board of Directors of the Company.

b. "Company" shall mean Ford Motor Company.

c. "Director Service" shall mean years of service as a member of the Board of Directors, not exceeding one year in any calendar year.

d. "Effective Date" means November 1, 1985.

e. "Eligible Director" shall mean a member of the Board of Directors on or after the Effective Date who is not a Company employee and has not retired from Company employment on or after December 1, 1977.

f. "Eligible Retired Director" shall mean a Retirement Eligible Director who shall have retired from the Board of Directors.

g. "Internal Revenue Code" or "Code" shall mean the Internal Revenue Code of 1986, as amended from time to time.

h. "Normal Retirement Age" shall mean the date of the annual stockholders meeting of the Company immediately following the Retirement Eligible Director's attainment of age 70. "Normal Retirement Date" shall mean the first day of the first calendar month coincident with or next following such Retirement Eligible Director's Normal Retirement Age.

i. "Plan Year" shall mean a calendar year.

j. "Retirement Eligible Director" shall mean an Eligible Director who has completed at least five years of Director Service and has attained age 55.

Section 3. Benefit .

(a) Life Insurance . Except as otherwise provided in Section 3(b) immediately below, an Eligible Director or Eligible Retired Director shall be entitled to life insurance in the amount of $200,000.

(b) Optional Death and Retirement Benefits . A Retirement Eligible Director meeting the eligibility requirements set forth in Section 3(b)(1) or (2) below may elect optional death and retirement benefits described in Section 3(b)(3) below in lieu of the life insurance described in Section 3(a) immediately above, as follows:

(1) Normal Retirement Date . A Retirement Eligible Director whose Normal Retirement Date occurs after the Effective Date and who, in accordance with Section 3(b)(5) below, elected to receive the optional death and retirement benefit described in Section 3(b)(3) below shall receive such optional death and retirement benefit.

(2) Resignation Prior to Normal Retirement Date . A Retirement Eligible Director who resigns from the Board of Directors on or after January 1, 1993 and prior to such director's Normal Retirement Date and who, in accordance with Section 3(b)(5) below, elected to receive the optional death and retirement benefit described in Section 3(b)(3) below shall receive such optional death and retirement benefit with approval of the Board of Directors.

(3) Benefit . The optional death and retirement benefit with respect to a Retirement Eligible Director who has made an election in accordance with Section 3(b)(5) below shall be as follows:

(i) life insurance in the amount of $100,000, plus

(ii) a monthly benefit, payable to such director during such director's lifetime, in the amount of $1,250 per month, beginning on the earlier of:

(A) with respect to a Retirement Eligible Director who meets the requirements of Section 3(b)(1) above, such director's Normal Retirement Date; or

(B) with respect to a Retirement Eligible Director who meets the requirements of Section 3(b)(2) above, the first day of the calendar month coincident with or next succeeding such director's resignation date.

(4) Waiver of Conversion Rights . A Retirement Eligible Director who makes the election provided in this Section 3(b) must waive any right to the conversion of the reduction in the amount of the life insurance.

(5) Optional Death and Retirement Benefit Election . Within thirty (30) days of becoming an Eligible Director, each Eligible Director may make an irrevocable election to receive the optional death and retirement benefit described in Section 3(b)(3) above in lieu of the life insurance benefit described in Section 3(a) above.

Section 4. Payments . The life insurance described in Section 3(a) or 3(b)(3)(i) shall be provided by the purchase from an insurance carrier of an insurance contract upon terms and conditions approved by the Executive Vice President and Chief Financial Officer or the designee of such officer. The retirement benefits provided in Section 3(b)(3)(ii) shall be payable out of the Company's general funds beginning on the date described in Section 3(b)(3)(ii)(A) or (B), as applicable, and shall cease at the end of the month in which such Eligible Retired Director dies.

Section 5. Designation of Beneficiary . The death benefits payable under the life insurance described in Section 3(a) or 3(b) (3)(i) shall be paid to the Eligible Director's or Eligible Retired Director's designated beneficiary, as applicable, or if there is no such beneficiary shall be paid in accordance with the provisions of the life insurance contract.

Section 6. Administration and Interpretation . The Group Vice President - Corporate Human Resources and Labor Affairs and the Executive Vice President and Chief Financial Officer shall have full power and authority on behalf of the Company to administer and interpret the Plan. All decisions with respect to the administration and interpretation of the Plan shall be final and shall be binding upon all persons.

Section 7. Amendments and Termination . The Board of Directors of the Company shall have the right at any time to amend, modify, discontinue or terminate this Plan in whole or in part; provided, however, that no such action shall deprive the beneficiary or estate of life insurance proceeds with respect to an Eligible Director or Eligible Retired Director who shall have died prior to the date of such action by the Board of Directors.

Section 8. Code Section 409A.

(a)

(b)

After receipt of Plan benefits accrued or vested after December 31, 2004, the obligations of the Company with respect to such benefits shall be satisfied and no Eligible Director, surviving spouse, or beneficiary shall have any further claims against the Plan or the Company with respect to Plan benefits accrued or vested after December 31, 2004.

(c)

For the avoidance of doubt, and notwithstanding any provisions of the Plan to the contrary, in the event a Specified Employee becomes entitled to a benefit under this Plan, payment of any such benefit that accrued or vested on or after January 1, 2005 shall not commence (or be paid) earlier than the first day of the seventh month following termination from employment with the Company. Any payment delayed under this Section shall not bear interest.

For purposes of this Section, "Specified Employee" shall mean an eligible member of the Board who is a Key Employee as defined in Code Section 416(i) without regard to paragraph 5 thereof. A Specified Employee shall be identified as of December 31 ^st of each calendar year and shall apply to any Specified Employee who shall terminate employment in the 12-month period commencing January 1 ^st of the immediately succeeding calendar year. This provision is effective for Specified Employees who resign or terminate employment on or after January 1, 2005.

Exhibit 10-M

SELECT RETIREMENT PLAN

Amended through October 1, 2006

Section 1. Introduction. On June 9, 1994, the Company established this Plan for the purpose of providing voluntary retirement incentives to selected U.S. Company employees who are assigned to Leadership Levels 1 through 5 of the Company, or their equivalent, constituting a select group of management or highly compensated employees.

Section 2. Definitions. As used in the Plan, the following terms shall have the following meanings, respectively:

2.01

"Benefit Equalization Plan" or "BEP" means the Ford Motor Company Benefit Equalization Plan, as it may be amended.

2.02

" Company " shall mean Ford Motor Company and such of the subsidiaries of Ford Motor Company as, with the consent of Ford Motor Company, shall have adopted this Plan.

2.03

"Contributory Service" means, without duplication, the years and any fractional year of contributory service at retirement, not exceeding one year for any calendar year, of the Eligible Executive under the General Retirement Plan.

2.04

"Credited Service" means, without duplication, the years and any fractional year of credited service at retirement, not exceeding one year for any calendar year, of the Eligible Executive under the General Retirement Plan.

2.05

"Deferred Equalization Plan" or "DEP" means the Ford Motor Credit Company Deferred Equalization Plan, as it may be amended.

2.06

"Eligible Executive" means a full time Company employee who is

(i)

at least age 55 as of the Retirement Effective Date, except as otherwise provided in Section 8, and who has at least ten years of service recognized for eligibility to receive a benefit under the General Retirement Plan as of the Retirement Effective Date,

(ii)

assigned to Leadership Levels 1 through 5 of the Company, or their equivalents,

(iii)

selected by the Company to participate in the Select Retirement Plan, and

(iv)

in good standing as of the last day of employment.

An Eligible Executive shall not include a Company employee who is an employee of Jaguar Cars, a division of the Company, until such an employee becomes a participant in one or more of the Retirement Plans, and then only to the extent of service recognized under such Retirement Plans for benefit calculation purposes.

2.07

"Executive Separation Allowance Plan" or "ESAP" means the Ford Motor Company Executive Separation Allowance Plan, as it may be amended.

2.08

"General Retirement Plan" or "GRP" means the Ford Motor Company General Retirement Plan, as it may be amended.

2.09

"Internal Revenue Code" or "Code" means the Internal Revenue Code of 1986, as amended from time to time.

2.10

"Plan" means the Select Retirement Plan of Ford Motor Company, as it may be amended.

2.11

"Retired Executive" means an Eligible Executive who retires from the Company under the terms and conditions of this Plan on the Retirement Effective Date.

2.12

"Retirement Effective Date" means the date designated by the Company. Such Retirement Effective Date shall be only on the first of a month. For purposes of determining the minimum 15% improvement described in Section 5.01, if a Retired Executive commences receiving a GRP benefit on or after the date on which the Retired Executive attains age 65, Retirement Effective Date means the date the Retired Executive commences receipt of the GRP benefit.

2.13

"Retirement Plans" means the General Retirement Plan, the Benefit Equalization Plan, the Supplemental Executive Retirement Plan, the Executive Separation Allowance Plan and the Deferred Equalization Plan.

2.14

"Select Benefits" means the retirement benefits described in Section 5 of this Plan.

2.15

"Separation From Service" means termination from Company employment.

2.16

"Specified Employee " means an employee of the Company who is a Key Employee as defined in Code Section 416(i) without regard to paragraph 5 thereof. A Specified Employee shall be identified as of December 31 ^st of each calendar year and shall apply to any Specified Employee who shall incur a Separation From Service in the 12-month period commencing January 1, of the immediately succeeding calendar year. This provision is effective for Specified Employees who incur a Separation From Service on or after January 1, 2005.

2.17

" Subsidiary " shall mean, as applied with respect to any person or legal entity specified, (i) a person or legal entity with a majority of the voting stock of which is owned or controlled, directly or indirectly, by the person or legal entity specified or (ii) any other type of business organization in which the person or legal entity specified owns or controls, directly or indirectly, a majority interest.

2.18

"Supplemental Executive Retirement Plan" or "SERP" means the Ford Motor Company Supplemental Executive Retirement Plan, as it may be amended.

Section 3. Agreement to Participate

3.01

Effective Agreement . An Eligible Employee who is eligible to receive Select Benefits under the Plan must submit to the Company a completed and signed agreement stating that his or her participation in the Plan is voluntary prior to receiving such Select Benefits. The Company shall provide a form agreement for this purpose and no other agreement or form shall be used for this purpose.

3.02

Revocation of Agreements . An Eligible Executive may revoke an agreement provided in accordance with Section 3.01 by giving written notice to the Company no later than seven (7) days after the date on which the Eligible Executive submitted a signed agreement to the Company in accordance with Section 3.01. The Company shall provide a revocation form for this purpose and no other revocation or form shall be used for this purpose.

Section 4. Eligibility for Retirement Plans. The eligibility of an Eligible Executive to receive a benefit under this Plan shall be determined in accordance with the provisions of the Retirement Plans after giving effect to the following adjustments:

Eligibility Service under the SERP shall be adjusted by adding three years of Eligibility Service to the years of Eligibility Service the Eligible Executive has attained as of the Retirement Effective Date; and

For purposes of meeting the minimum eligibility requirements under Section 3 of ESAP, (i) three years of Executive Roll service shall be added to the Eligible Retired Executive's Executive Roll Service as of the Retirement Effective Date, and (ii) three years of Contributory Service shall be added to the Eligible Executive's years of Contributory Service as of the Retirement Effective Date, without the requirement of employee contributions.

In the event an Eligible Executive becomes eligible to receive a benefit under this Plan solely because of the service adjustments described above, the Select Benefits shall be calculated as provided in Section 5 below and shall be payable exclusively under this Plan rather than SERP or ESAP, as applicable.

Section 5. Calculation of Select Benefits.

5.01

GRP Select Benefits. The GRP Select Benefit payable to a Retired Executive shall be an amount equal to the difference between (X) and (Y) where (X) is the GRP benefit determined under the terms of the GRP after giving effect to the following adjustments:

Add three years to the Retired Executive's attained age as of the Retirement Effective Date only for the purpose of determining the applicable early retirement reduction factors set forth in Appendix G to the GRP and three years to the Retired Executive's years of Contributory Service as of the Retirement Effective Date, without the requirement of employee contributions; and

Final Average Monthly Salary for a Retired Executive under the terms of this Plan shall be determined as if the Retired Executive had been a Contributing member and received Contributory Service for three additional years after the Retirement Effective Date at the Retired Executive's Salary in effect as of the date immediately preceding the Retirement Effective Date;

and (Y) is the GRP benefit determined under the terms of the GRP in effect as of the Retirement Effective Date, regardless of whether an application for GRP benefits has been submitted or GRP benefit payments have begun.

The GRP Select Benefit determined as of the Retirement Effective Date shall be an amount equal to at least a fifteen percent (15%) improvement to the GRP benefit determined under the terms of the GRP in effect as of the Retirement Effective Date. If the Retired Executive's benefit under the GRP is redetermined at Age 62 and One Month, the GRP Select Benefit shall be redetermined and adjusted such that the GRP Select Benefit shall be an amount equal to at least a fifteen percent (15%) improvement to the GRP benefit redetermined under the terms of the GRP then in effect as of the redetermination date.

5.02

SERP Select Benefits. The SERP Select Benefit applicable to a Retired Executive who is otherwise eligible, or who becomes eligible, for a SERP benefit under the terms of the SERP in effect as of the Retirement Effective Date, as modified by Section 4 of this Plan, shall be an amount equal to the difference between (X) and (Y) where (X) is the SERP benefit determined under the terms of the SERP after giving effect to the following adjustments:

Add three years to the Retired Executive's attained age as of the Retirement Effective Date and three years of Credited Service to the Retired Executive's years of Credited Service as of the Retirement Effective Date; and

The Final Five Year Average Base Salary for a Retired Executive receiving Credited Service immediately preceding his or her Retirement Effective Date under the terms of this Plan shall be determined as if the Retired Executive had continued to receive Credited Service for three additional years after the Retirement Effective Date at the Retired Executive's Monthly Base Salary;

and (Y) is the SERP benefit determined under the terms of the SERP in effect as of the Retirement Effective Date.

The SERP Select Benefit determined as of the Retirement Effective Date shall be an amount equal to at least a fifteen percent (15%) improvement to the SERP benefit determined under the terms of the SERP in effect as of the Retirement Effective Date.

5.03

ESAP Select Benefits. The ESAP Select Benefit applicable to a Retired Executive who is otherwise eligible, or who becomes eligible, for an ESAP benefit under the terms of the ESAP in effect as of the Retirement Effective Date, as modified by Section 4 of this Plan, shall be an amount equal to the difference between (X) and (Y) where (X) is the ESAP benefit determined under the terms of the ESAP in effect as of the Retirement Effective Date after giving effect to the following adjustments:

Add three years to the Retired Executive's attained age as of the Retirement Effective Date; and

Add three years of service to the Retired Executive's years of service as of the Retirement Effective Date;

and (Y) is the ESAP benefit calculated under the terms of the ESAP in effect as of the Retirement Effective Date.

The ESAP Select Benefit determined as of the Retirement Effective Date shall be an amount equal to at least a fifteen percent (15%) improvement to the ESAP benefit determined under the terms of the ESAP in effect as of the Retirement Effective Date.

The amount of any ESAP Select Benefit determined for any Leadership Level 1 or 2 employee (or such employee's eligible surviving spouse) shall be reduced by any GRP Select Benefit determined for such Leadership Level 1 or 2 employee (or such employee's eligible surviving spouse).

5.04

DEP Select Benefits. The DEP Select Benefit applicable to a Retired Executive who is otherwise eligible for a DEP benefit under the terms of the DEP in effect as of the Retirement Effective Date, shall be an amount equal to the difference between (X) and (Y) where (X) is the DEP benefit determined under the terms of the DEP after adjusting Final Average Monthly Salary as if the Retired Executive had been a Contributing member and received Contributory Service for three additional years after the Retirement Effective Date at the Retired Executive's Salary and (Y) is the DEP benefit determined under the terms of the DEP in effect as of the Retirement Effective Date.

Section 6. Payment of Select Benefits.

6.01

Except as otherwise provided herein, payment of Select Benefits determined under Section 5 shall commence on the first day of the month following the date that is the later of the date on which the Eligible Executive:

(a)	reaches at least age 55 with 10 years of service, except as otherwise provided in Section 8.02; or

(b)	has a Separation From Service.

6.02

Select Benefits shall be payable monthly from the Company's general funds.

6.03

Notwithstanding any other provision of the Plan to the contrary, if a Specified Employee incurs a Separation From Service, payment of any Select Benefit accrued or vested after December 31, 2004 shall commence no earlier than the first day of the seventh month following their Separation From Service. Any payment delayed under this Section shall not bear interest.

6.04

Payments to a Retired Executive shall cease at the end of the month in which the Retired Executive dies. Except as otherwise provided herein, survivor benefits, if any, payable with respect to any Select Benefits provided under this Plan shall be determined in accordance with the applicable Retirement Plan, other than the GRP, after giving effect to any applicable adjustments. Survivor benefits payable with respect to GRP Select Benefits shall be paid monthly to a Retired Executive's surviving spouse or other beneficiary designated by the Retired Executive in an amount equal to the monthly GRP Select Benefit payment, determined in accordance with Section 5.01, that otherwise would have been payable to the deceased Retired Executive, after giving effect to any applicable adjustments. Any such survivor benefits paid with respect to GRP Select Benefits shall cease at the death of the surviving spouse or other designated beneficiary.

Section 7. Administration of Select Benefits. Except as otherwise specifically provided in this Plan, the Select Benefits attributable to the Retirement Plans shall be administered by the Company in the same manner as if the Select Benefits were payable directly from such Retirement Plans. This means that the underlying eligibility rules (except as modified by Section 4 of this Plan), vesting rules, earning out provisions and survivorship provisions of the Retirement Plans, if any, shall apply to the Select Benefits as if such provisions were fully incorporated in this Plan.

Section 8. Reduction of Minimum Age Eligibility.

8.01

Authority to Reduce Minimum Age Eligibility. The Executive Chairman of the Company shall have the authority, from time to time in his or her sole and absolute discretion, to reduce the minimum age eligibility specified in Section 2.06(i) of the Plan from age 55 to age 52.

8.02

Under Age 55 Select Benefits. If an Eligible Executive becomes eligible to receive a Select Benefit under this Plan pursuant to Section 8.01, the Select Benefits shall be calculated as provided in Section 5 above. When a benefit becomes payable to the Eligible Executive under the Retirement Plans, the amount of the Select Benefits shall be reduced by the amounts payable from such other Retirement Plans.

8.03

Subsidiary Retirement Plans. If an Eligible Executive under age 55 would have become eligible for a regular early retirement benefit from a Subsidiary's retirement plan if he or she had remained in Subsidiary employment until the minimum age or service eligibility requirements under such Subsidiary's plan were met, this Plan shall pay the equivalent Subsidiary early retirement benefit that otherwise would have been paid if the minimum eligibility requirements were met on the Retirement Effective Date. The payment shall cease at such time as the regular early retirement benefit from the Subsidiary's plan becomes payable. If the Subsidiary's plan shall pay only a deferred vested benefit at age 55, the payment shall cease at death of the Eligible Executive. Survivor benefits, if any, shall cease at death of the Surviving Spouse. Any payments payable under this Plan shall be reduced by the amount of the deferred vested or survivor's benefit payable under such Subsidiary's plan. The amounts payable pursuant to this paragraph shall be in addition to any other Select Benefits that otherwise may be payable under this Plan.

Section 9. General Provisions.

9.01

Plan Administration and Interpretation.

(a)

Notwithstanding any other provisions of the Plan to the contrary, the terms of the Plan shall determine the benefits payable to an Eligible Executive and no Eligible Executive shall be permitted to receive a benefit under the Plan that would be inconsistent with such terms.

(b)

The Group Vice President - Corporate Human Resources and Labor Affairs and the Executive Vice President and Chief Financial Officer shall have full power and authority on behalf of the Company to administer and interpret the Plan. In the event of a change in a designated officer's title, the officer or officers with functional responsibility for the Retirement Plans shall have the power and authority to administer and interpret the Plan. All decisions with respect to the administration and interpretation of the Plan shall be final and binding upon all persons.

9.02

Local Payment Authorities. The Vice President and Treasurer and the Assistant Treasurer (or in the event of a change in title, their functional equivalent) may act individually to delegate authority to administrative personnel to make benefit payments to employees in accordance with plan provisions.

9.03

Deductions. The Company may deduct from any payment of Select Benefits to a Retired Executive all amounts owing to it by such Retired Executive for any reason, and all taxes required by law or government regulation to be deducted or withheld.

9.04

No Contract of Employment. The Plan is an expression of the Company's present policy with respect to Eligible Executives. It is not a part of any contract of employment. No Eligible Executive, Retired Executive or any other person shall have any legal or other right to any Select Benefit.

9.05

No Company Reemployment. A Retired Executive shall not be eligible for reemployment by the Company either directly or indirectly through an agency or otherwise. This includes, but is not limited to, employment of a Retired Executive by the Company as a supplemental employee, independent contractor, consultant, advisor, or agency employee, regardless of the length of employment. It also includes employment of a Retired Executive by a sole or single source supplier to the Company, or employment by any supplier of the Company if the responsibilities of the Retired Executive relate primarily to the Company's business with the supplier, and are not merely incidental to the performance of the Retired Executive's other job duties. A review panel consisting of at least two representatives from Human Resources and one representative from the Office of the General Counsel shall be established to review Retired Executive's requests for reemployment. The Retired Executive shall furnish to the Review Panel such information about the proposed employment as is reasonably requested to enable the Review Panel to evaluate the request. The Review Panel shall have sole and absolute discretion to determine whether the request for reemployment violates this provision. Decisions of the Review Panel are final and binding on all parties and are not subject to further review.

The reemployment condition may be waived by the Executive Personnel Committee (EPC) if the proposed employment advances the strategic interests of the Company or is otherwise determined to be in the best interests of the Company provided that, under the waiver, the employment arrangement does not permit the Retired Executive to perform 50% or more of a full-time position and he/she receives less than 50% of any compensation earned during the final three full calendar years of employment (or if less, such lesser period).

In the event a Retired Executive becomes reemployed in violation of this provision without obtaining a waiver, the EPC may suspend Select Benefits retroactively to the date of reemployment and recover amounts overpaid from the Retired Executive's non-qualified benefits, if any, or any other source permitted by law. The EPC also may terminate a Retired Executive's future eligibility for Select Benefits or take any other action reasonably necessary, in the EPC's sole discretion, to enforce the provisions of this Section.

9.06

Select Benefits Not Funded. The Company's obligations under this Plan are not funded. Select Benefits under this Plan shall be payable only out of the general funds of the Company.

9.07

Continuing Plan. The Plan shall be an ongoing Plan and shall be made available at the discretion of the Company. The Company may designate certain periods within a calendar year in which offers of Select Benefits may be made and may provide that no offers of Select Benefits may be accepted before or after designated dates within a calendar year. The Company also may limit the offer of Select Benefits to those within a designated salary roll or band. Select Benefits may be combined with additional types of termination incentives upon the direction of the Company. Provisions of such other termination incentives are not governed by the terms of this Plan.

9.08

Governing Law. Except as otherwise provided under federal law, the Plan and all rights thereunder shall be governed, construed and administered in accordance with the laws of the State of Michigan.

9.09

Amendment or Termination. The Company reserves the right to modify or amend, in whole or in part, or to terminate this Plan, at any time without notice.

9.10

Terms Not Otherwise Defined. Capitalized terms not otherwise defined in this Plan shall have the same meanings ascribed to such terms under the applicable Retirement Plans.

Section 10. Code Section 409A.

After receipt of Plan benefits accrued or vested after December 31, 2004, the obligations of the Company with respect to such benefits shall be satisfied and no Eligible Executive, surviving spouse, or beneficiary shall have any further claims against the Plan or the Company with respect to Plan benefits accrued or vested after December 31, 2004.

Section 11. Claim for Benefits

11.01

Denial of a Claim. A claim for benefits under the Plan shall be submitted in writing to the plan administrator. If a claim for benefits or participation is denied in whole or in part by the plan administrator, the Eligible Executive will receive written notification within a reasonable period from the date the claim for benefits or participation is received. Such notice shall be deemed given upon mailing, full postage prepaid in the United States mail or on date sent electronically to the claimant. If the plan administrator determines that an extension of time for processing is required, written notice of the extension shall be furnished to the Eligible Executive as soon as practical.

11.02

Review of Denial of Claim . In the event that the plan administrator denies a claim for benefits or participation, an Eligible Executive may request a review by filing a written appeal to the Group Vice President - Corporate Human Resources and Labor Affairs and the Executive Vice President and Chief Financial Officer, or their designee(s), within sixty (60) days of receipt of the written notification of denial. The appeal will be considered and a decision shall be rendered as soon as practical. In the event a time extension is needed to consider the appeal and render the decision, written notice shall be provided to the Eligible Executive notifying them of such time extension.

11.03

Decision on Appeal. The decision on review of the appeal shall be in writing. Such notice shall be deemed given upon mailing, full postage prepaid in the United States mail or on the date sent electronically to the Eligible Executive. Decisions rendered on the appeal are final and conclusive and are only subject to the arbitrary and capricious standard of judicial review.

11.04

Limitations Period. No legal action for benefits under the Plan may be brought against the Plan until after the claims and appeal procedures have been exhausted. Legal actions under the Plan for benefits must be brought no later than two (2) years after the claim arises. No other action may be brought against the Plan more than six (6) months after the claim arises.

FORD MOTOR COMPANY DEFERRED COMPENSATION PLAN

(Amended and Restated as of July 12, 2006)

1. Purpose. This Plan, which shall be known as the “Ford Motor Company Deferred Compensation Plan” and is hereinafter referred to as the “Plan”, is intended to provide for the deferment of payment of (i) awards of incentive compensation under the Ford Motor Company Annual Incentive Compensation Plan and similar plans, (ii) base salary, (iii) incentive awards payable in cash or stock under the Ford Motor Company 1990 Long-Term Incentive Plan, Ford Motor Company 1998 Long-Term Incentive Plan or any other incentive compensation plan of the Company and (iv) new hire payments.

2. Definitions. As used in the Plan, the following terms shall have the following meanings, respectively:

(a) The term “AIC Plan” shall mean the Ford Motor Company Annual Incentive Compensation Plan, as amended.

(b) The term “Committee” shall mean, unless the context otherwise requires, the following as they from time to time may be constituted:

(i) The Compensation Committee with respect to all matters affecting any Section 16 Person.

(ii) The Deferred Compensation Committee with respect to all matters affecting employees other than Section 16 Persons.

(d) The term “Compensation Committee” shall mean the Compensation Committee of the Board of Directors of the Company.

(e) The term “Deferred Compensation” shall mean compensation deferred pursuant to paragraph (a), (b), (c) or (d) of Section hereto, and any interest equivalents, dividend equivalents or other earnings or return on such amounts determined in accordance with the Plan.

(f) The term “Deferred Compensation Account” with respect to a participant shall mean the book entry account established by the Company for such participant with respect to his or her Deferred Compensation.

(g) The term “Deferred Compensation Committee” shall mean the committee comprised of the Group Vice President, Corporate Human Resources and Labor Affairs, the Executive Vice President and Chief Financial Officer and the Senior Vice President and General Counsel or such other persons as may be designated members of such Committee by the Compensation Committee.

(h) The term “employee” shall mean any person who is regularly employed by the Company or a subsidiary at a salary (as distinguished from a pension, retirement allowance, severance pay, retainer, commission, fee under a contract or other arrangement, or hourly, piecework or other wage) and is enrolled on the active employment rolls of the Company or a subsidiary, including, but without limitation, any employee who also is an officer or director of the Company or a subsidiary.

(i) The term “Ford Stock” shall mean Ford Common Stock.

(j) The term “Ford Stock Unit” shall mean a unit having a value based upon Ford Stock.

(k) The term "IPOC" shall mean the Investment Process Oversight Committee comprised of the Vice President - Treasurer, the Associate General Counsel and Secretary, and the Vice President - Human Resources.

(l) The term "Investment Process Committee" shall mean the committee comprised of the Director - Global Trading and Governance, the Director - Asset Management, and the Manager - Savings and Executive Retirement Plans, North America.

(m) The term “LTI Plan” shall mean the Ford Motor Company 1990 Long-Term Incentive Plan, as amended, the Ford Motor Company 1998 Long-Term Incentive Plan, as amended, or any other long-term incentive plans subsequently adopted by the Company that are substantially similar to such plans.

(n) The term “SC Plan” shall mean the Ford Motor Company Supplemental Compensation Plan, as amended.

(o) The term “Section 16 Person” shall mean any employee who is subject to the reporting requirements of Section 16(a) or the liability provisions of Section 16(b) of the Securities Exchange Act of 1934, as amended.

(p) The term “SSIP” shall mean the Company’s Savings and Stock Investment Plan for Salaried Employees, as amended.

(q) The term “subsidiary” shall mean (i) any corporation a majority of the voting stock of which is owned directly or indirectly by the Company or (ii) any limited liability company a majority of the membership interest of which is owned directly or indirectly by the Company.

(r) The term “VIP Plan” shall mean Ford Motor Credit Company Variable Incentive Plan, as amended.

3. Administration. Except as otherwise herein expressly provided, the Compensation Committee shall have full power and authority to construe, interpret and administer the Plan. The Compensation Committee shall make all decisions relating to matters affecting any Section 16 Person, but may otherwise delegate any of its authority under the Plan. The Compensation Committee and the Deferred Compensation Committee each may at any time adopt or terminate, and may from time to time amend, modify or suspend such rules, regulations, policies and practices as they in their sole discretion may determine in connection with the administration of, or the performance of their respective responsibilities under, the Plan.

4. Eligibility of Participants; Amounts Deferrable.

(a) Participating Subsidiaries and Foreign Location Participants. The Deferred Compensation Committee shall determine the extent to which subsidiaries and employees at foreign locations may participate in the Plan or similar plans and the type and amount of compensation that may be deferred under, or the type and amount of account balances that may be transferred to, the Plan pursuant to this paragraph (a).

(b) Annual Incentive Compensation Deferrals Under the AIC Plan and Other Similar Plans. Subject to any limitations determined under paragraph (a) or paragraph (g) of this Section 4 or paragraph (a) of Section 5, U.S. employees who receive an annual incentive compensation award or an installment of such an award payable in cash under the AIC Plan or the VIP Plan, are eligible to defer payment under the Plan from 1% to 100%, in 1% increments, of such amount net of applicable taxes, but not less than $1,000, provided that such employees are actively employed by the Company in Leadership Level 1-5 or the equivalent at the time of the election to defer. Notwithstanding the foregoing, the Compensation Committee may in its sole discretion allow deferrals under this paragraph (b) by persons that do not meet the eligibility requirements described above.

(c) Base Salary Deferrals. Subject to any limitations determined under paragraph (a) or paragraph (g) of this Section 4, U.S. employees who are eligible to participate in the AIC Plan or the VIP Plan, and who are actively employed by the Company in Leadership Level 1-5 or the equivalent at the time a salary deferral election is made are eligible to defer payment of from 1% to 50% of base salary in 1% increments, provided that the Compensation Committee has determined that base salary deferrals may be made for the employment period covered by such deferral. Notwithstanding the foregoing, the Compensation Committee may impose such additional limitations on eligibility as it deems appropriate in its sole discretion.

(d) Deferrals of Incentive Compensation. Subject to any limitations determined under paragraph (a) or paragraph (g) of this Section 4, U.S. employees who are eligible to participate in the AIC Plan or the VIP Plan, and who are actively employed by the Company at the time an election is made to defer payment of an award payable under the LTI Plan or other incentive compensation plan are eligible to defer payment of from 1% to 100%, in 1% increments, of such award net of applicable taxes, but not less than $1,000 or the equivalent value determined at the time of the deferral, provided that the Compensation Committee has determined that deferrals may be made for such awards. Notwithstanding the foregoing, the Compensation Committee may in its sole discretion allow deferrals under this paragraph (d) by persons that do not meet the eligibility requirements described above.

(e) Deferral of Awards under SC Plan. Notwithstanding anything in the Plan to the contrary, deferrals of awards of supplemental compensation made under the SC Plan for years 1995-1997 shall be governed by the same provisions of the Plan that apply to awards of incentive compensation under the AIC Plan. Any references to the AIC Plan shall be deemed to cover awards under the SC Plan.

(f) Deferral of New Hire Payments. Notwithstanding anything contained in the Plan to the contrary, subject to any limitations determined under paragraph (a) or paragraph (e) of this Section 4, newly hired U.S. employees who are eligible to participate in the AIC Plan or the VIP Plan, and who received an employment offer from the Company that included a new hire payment in cash are eligible to defer payment from 1% to 100%, in 1% increments, of such new hire payment net of applicable taxes, but not less than $1,000, provided that such employees are actively employed by the Company in Leadership Level 1-5 or the equivalent at the time the new hire payment would otherwise be payable in the absence of such deferral.

(g) Eligibility of Compensation Committee Members. No person while a member of the Compensation Committee shall be eligible to participate under the Plan.

(h) Transfer of Deferral Accounts from SC Plan. Effective as of the close of business on October 16, 1998, all outstanding book entry accounts maintained under the SC Plan in the form of contingent credits for cash and/or Ford Common Stock shall be transferred to the Plan and governed by the provisions of the Plan. Upon such transfer, contingent credits for cash shall be valued based on the Fidelity Retirement Money Market Portfolio and contingent credits for Ford Common Stock shall be valued based on the Ford Stock Fund until such time, if any, as all or any part of such amounts are transferred by the applicable participants to other investment options available under the Plan. Ultimate payout of a transferred deferral account shall be in cash, except that, to the extent that the transferred account is valued based on the Ford Stock Fund, the participant may make an election prior to the transfer of the account to receive the ultimate payout in whole shares of Common Stock.

(i) Transfer of Deferral Accounts to Visteon Plan. Anything in the Plan to the contrary notwithstanding, all outstanding book entry deferral accounts maintained under the Plan for participants who become employees of Visteon Corporation ("Visteon") or any of its consolidated subsidiaries immediately following employment with the Company shall be transferred to a new Visteon Deferred Compensation Plan ("Visteon DCP") to be adopted by Visteon and governed by the provisions of that plan, effective as of 5:00 p.m. Eastern Time on June 30, 2000 (the "Transfer Date"). The transferred account balances may not be immediately available for redesignations under the Plan until account balances have been properly verified by the recordkeepers for both plans. On and after the Transfer Date, any deferrals by such employees shall be made under the Visteon DCP, even if the election to defer was made prior to the Transfer Date. Unless the participant changes his or her investment options for any such deferral, the Visteon DCP shall honor the investment elections that were in effect under this Plan for such class year and type of compensation to the extent the Visteon DCP has the same investment choices. The Visteon DCP shall have a Ford Stock Fund investment option for those transferred accounts that had deferrals based on the Ford Stock Fund under this Plan as of the Transfer Date, but the Ford Stock Fund under the Visteon DCP shall be a "sell only" fund, and would not be available for any new deferrals or redesignations into such fund from other funds or for credits based on dividend equivalents. Distributions relating to the transferred accounts shall be made under the Visteon DCP in the form specified by the participant while employed by the Company.

(j) Payout in Ford Stock. Anything in the Plan to the contrary notwithstanding, the Compensation Committee may determine that certain awards otherwise payable in Ford Stock under the LTI Plan that are deferred under the Plan shall be distributed in whole shares of Ford Stock rather than in cash if, at the time of the initial deferral of the award, the participant elected (i) the Ford Stock Fund as the option for measuring the value of the award and (ii) shares of Ford Stock rather than cash as the form of payment. In addition, the Committee may require, as a condition to such deferral, that (x) the participant make the elections described in (i) and (ii) above, (y) the value of such deferral continue to be measured based on the Ford Stock Fund with no redesignation of such deferral to other measurement options under the Plan allowed and (z) the ultimate form of payout may not be changed by the participant to cash.

5. Deferral Elections.

(a) Annual Incentive Compensation Deferrals. For performance years beginning prior to January 1, 2005, a participant’s decision to defer payment of annual incentive compensation under paragraph (b) of Section 4 under the Plan must be made prior to October 31 of the performance year for which the compensation is determined. For performance years beginning on or after January 1, 2005, a participant’s decision to defer payment of annual incentive compensation under paragraph (b) of Section 4 under the Plan must be made prior to June 30 of the performance year for which the compensation is determined; provided, however, that newly hired employees may not make such an election to defer payment of annual incentive compensation in the year of hire.

(b) Base Salary Deferrals. A participant’s decision to defer payment of base salary under the Plan must be made prior to the calendar year during which the base salary will be earned; provided, however, that such decision may be made with respect to base salary earned during the first calendar year that base salary deferrals are permitted under the Plan within thirty days of implementation of the base salary component of the Plan but prior to earning any such salary.

(c) Incentive Compensation Deferrals. Subject to the limitations set forth in Section 4 hereof, the Compensation Committee shall determine the required timing for participants to make elections to defer payment of awards payable in cash or stock under the LTI Plan or other incentive compensation plan.

(d) New Hire Payment Deferrals. A participant’s decision to defer payment of a new hire payment must be made on or before the date of hire.

(e) Mandatory Deferrals. The Compensation Committee may mandatorily defer payment under the Plan of a portion of certain annual incentive compensation awards pursuant to the AIC Plan. The Compensation Committee may determine the extent to which it may mandatorily defer payment under the Plan of awards payable in cash or stock under the LTI Plan or other incentive compensation plan.

(f) Deferred Compensation Accounts. Amounts deferred pursuant to paragraphs (a), (b), (c), (d) or (e) of Section 5, and deferral amounts relating to any transfer to the Plan pursuant to paragraph (h) of Section 4, will be credited by book entry to the participant’s Deferred Compensation Account. All such amounts shall be held in the general funds of the Company. Each participant shall have the status of an unsecured general creditor of the Company with respect to his or her Deferred Compensation Account. The participant shall designate the percentage of the amount elected for deferral to be allocated to each investment option available under the Plan for purposes of accounting only and not for actual investment.

In addition, with respect to any particular deferral under the Plan, the participant shall elect at the time of the initial deferral election (i) the year in which distribution shall be made or distribution upon retirement and (ii) the method of distribution desired with respect to any such deferral election if the participant elected distribution upon retirement, i.e., in a lump sum payment or in up to ten annual installments.

(g) Prohibited Elections or Other Actions. Notwithstanding anything contained in the Plan to the contrary, no otherwise permissible election or other action is allowed that would trigger taxation of any amount under Section 409A of the Internal Revenue Code of 1986, as amended.

6. Investment Options; Methodology; No Ownership Rights.

(a) General. The IPOC has the sole discretion to determine the investment options available as the measurement mechanism for deferrals and redesignations under the Plan, the manner and extent to which elections may be made, the method of valuing the various investment options and the Deferred Compensation Accounts and the method of crediting the Deferred Compensation Accounts with, or making other adjustments as a result of, dividend equivalents, interest equivalents or other earnings or return on such Accounts. The Investment Process Committee shall perform the same functions under the Plan that it performs under the SSIP.

(b) Methodology. Unless otherwise determined by the Compensation Committee, the methodology for valuing the various investment options and the Deferred Compensation Accounts and for calculating amounts to be credited or debited or other adjustments to any Deferred Compensation Account with respect to any investment options shall be the same as that used under the SSIP.

(c) No Ownership Rights. Investment options available under the Plan shall be used solely for measuring the value of Deferred Compensation Accounts and accounting, on a book entry basis, as if the deferred amounts had been invested in actual investments, but no such investments shall be made on behalf of participants. Participants shall not have any voting rights or any other ownership rights with respect to the investment options selected as the measuring mechanism for their Deferred Compensation Accounts.

7. Redesignation Within a Deferred Compensation Account.

(a) General. Except as otherwise provided in paragraph (f) of this Section 7, a participant or the beneficiary or legal representative of a deceased participant, may redesignate amounts credited to a Deferred Compensation Account among the investments available under the Plan. No redesignations relating to a particular deferral may occur on or after the scheduled distribution date for the deferral under the Plan.

(b) Eligible Participants. Active employees and retired participants are eligible to redesignate.

(d) Amount of Redesignation. Any redesignation relating to a particular deferral shall be in a specified percentage or dollar amount of the investment option from which the redesignation is being made.

(e) Timing. Redesignation shall occur on the day the participant’s written redesignation election form or telephonic election is received by the Company or its agent designated for this purpose; provided, however, that if such redesignation request is received after 4 p.m. Eastern Time, or on a day that is not a business day (i.e., a day that either the Company’s World Headquarters offices in Dearborn, Michigan or the principal offices of its designated agent are not open to the public for business), then such redesignation shall be effective on the next business day.

(f) Limitations on Redesignations Involving Ford Stock Units. The Committee in its sole discretion at any time may rescind a redesignation in or out of Ford Stock Units if such redesignation was made by a participant who (i) at the time of the redesignation the Committee believes was in the possession of material, nonpublic information with respect to the Company and (ii) in the Committee’s estimation benefited from such information by the timing of his or her redesignation. In the event of a rescission, the participant’s Deferred Compensation Account shall be restored to a status as though such redesignation had not occurred.

8. Adjustments. In the event of a reorganization, recapitalization, stock split, stock dividend, combination of shares, merger, consolidation, rights offering or any other change in the corporate structure of the Company or shares of Ford Stock or units of any other investment option provided under the Plan, the Compensation Committee shall make such adjustments, if any, as it may deem appropriate in the number of Ford Stock Units, shares of Ford Stock, including shares represented by Ford Stock Units, or shares or units of other investment options credited to participants’ Deferred Compensation Accounts.

9. Distribution of Deferred Compensation; Financial Hardship.

(a) General. Except as otherwise provided in paragraph (b) of this Section 9 or in Section 11, or as otherwise determined by the Committee, distribution of all or any part of a participant’s Deferred Compensation Account shall be made on, or as soon thereafter as practicable, (i) March 15 of the year selected by the participant for distribution with respect to the particular deferral if the participant is an active employee of the Company on the distribution date, (ii) the March 15 following death or termination for reasons other than retirement, notwithstanding any prior selection by the participant of a subsequent year for distribution with respect to the particular deferral, (iii) the March 15 following retirement if the participant selected distribution upon retirement with respect to the particular deferral and a lump sum distribution was selected, or if the participant selected a particular year for distribution with respect to the particular deferral but retired prior to the year selected, or (iv) the March 15 following retirement with respect to the first annual installment and continuing on the applicable number of consecutive anniversaries of such date if no more than ten annual installments were selected by the participant with respect to the particular deferral. Unless otherwise determined by the Committee, a Deferred Compensation Account or part thereof relating to a particular distribution shall be valued, for purposes of the distribution, as of the following applicable date or as soon thereafter as practicable: March 15 of the year of distribution or the next preceding day for which valuation information is available. Notwithstanding anything contained in the Plan to the contrary, for post-2004 deferrals under the Plan, (i) termination of employment other than for death shall not trigger acceleration of distribution of any or all of a participant's Deferred Compensation Account relating to such deferrals, and (ii) no distribution of any or all of a Deferred Compensation Account relating to such deferrals held by any "key employee" (defined under Section 416(i) of the Internal Revenue Code of 1986, as amended) shall occur earlier than six months following the key employee's termination of employment, except in the case of death. In addition, the Compensation Committee shall determine the extent to which participants may be allowed to elect to change the timing of their distributions prior to retirement; provided, however, that in no event shall any changes be allowed that would trigger taxation of any amount under Section 409A of the Internal Revenue Code of 1986, as amended.

(b) Financial Hardship. At the written request of a participant, the Committee, in its sole discretion, may authorize the cessation of deferrals under the Plan by such participant and distribution of all or any part of the participant's Deferred Compensation Account prior to his or her scheduled distribution date or dates, or accelerate payment of any installment payable with respect to Deferred Compensation, upon a showing of unforeseeable emergency by the participant. For purposes of this paragraph, "unforeseeable emergency" shall mean severe financial hardship resulting from extraordinary and unforeseeable circumstances arising as a result of one or more recent events beyond the control of the participant. In any event, payment shall not be made to the extent such emergency is or may be relieved (i) through reimbursement or compensation by insurance or otherwise, (ii) by liquidation of the participant's assets, to the extent the liquidation of such assets would not itself cause severe financial hardship and (iii) by cessation of deferrals under the Plan. Withdrawals of amounts because of unforeseeable emergency shall only be permitted to the extent reasonably necessary to satisfy the emergency. Examples of what are not considered to be unforeseeable emergencies include the need to send a participant's child to college or the desire to purchase a home. The Committee shall determine the applicable distribution date and the date as of which the amount to be distributed shall be valued with respect to any financial hardship withdrawal or distribution made pursuant to this paragraph (b) of this Section 9. Any participant whose deferrals have ceased under the Plan pursuant to this paragraph may not elect to recommence deferrals until such time as is determined by the Committee, but in no event earlier than permitted under Section 409A of the Internal Revenue Code of 1986, as amended. In the event of a participant's financial hardship withdrawal under the Plan or any employer-sponsored savings plan, deferrals by such participant under the Plan shall be suspended for twelve months following the date of such withdrawal.

(c) Prohibited Distributions or Other Actions. Notwithstanding anything contained in the Plan to the contrary, no otherwise permissible distribution or other action is allowed that would trigger taxation of any amount under Section 409A of the Internal Revenue Code of 1986, as amended.

(d) Election to Change Method and/or Timing of Distributions for Pre-2005 Deferrals. Notwithstanding anything contained in the Plan to the contrary, elections by active participants to change the method and/or timing of distributions for pre-2005 deferrals may be allowed; provided, however, that distributions may not be changed to a lump sum in-service payment in a future year.

10. Designation of Beneficiaries and Effect of Death.

(a) Designation of Beneficiaries. A participant may file with the Company a written designation of a beneficiary or beneficiaries (subject to such limitations as to the classes and number of beneficiaries and contingent beneficiaries and such other limitations as the Compensation Committee from time to time may prescribe) to receive, in the event of the death of the participant, undistributed amounts of Deferred Compensation that would have been payable to such participant had he or she been living. A participant shall be deemed to have designated as beneficiary or beneficiaries under the Plan the person or persons who receive such participant’s life insurance proceeds under the Company-paid basic Life Insurance Plan unless such participant shall have assigned such life insurance or shall have filed with the Company a written designation of a different beneficiary or beneficiaries under the Plan. A participant may from time to time revoke or change any such designation of beneficiary and any designation of beneficiary under the Plan shall be controlling over any testamentary or other disposition; provided, however, that if the Committee shall be in doubt as to the right of any such beneficiary to receive any such payment, or if applicable law requires the Company to do so, the same may be paid to the legal representatives of the participant, in which case the Company, the Committee and the members thereof shall not be under any further liability to anyone.

(b) Distribution Upon Death. Subject to the provisions of Section 9 hereof, in the event of the death of any participant prior to distribution of all or part of such participant’s Deferred Compensation Account, the total value of such participant’s entire Deferred Compensation Account shall be distributed in cash, except as otherwise provided in paragraph (h) or (j) of Section 4, in one lump sum in accordance with paragraph (a) of Section 9 to any beneficiary or beneficiaries designated or deemed designated by the participant pursuant to paragraph (a) of this Section 10 who shall survive such participant (to the extent such designation is effective and enforceable at the time of such participant’s death) or, in the absence of such designation or such surviving beneficiary, or if applicable law requires the Company to do so, to the legal representative of such person, at such time (or as soon thereafter as practicable) and otherwise as if such person were living and had fulfilled all applicable conditions as to earning out set forth in, or established pursuant to the Plan, provided such conditions shall have been fulfilled by such person until the time of his or her death.

11. Effect of Inimical Conduct. Anything contained in the Plan notwithstanding, all rights of a participant under the Plan to receive distribution of all or any part of his or her Deferred Compensation Account shall cease on and as of the date on which it has been determined by the Committee that such participant at any time (whether before or subsequent to termination of such participant’s employment) acted in a manner inimical to the best interests of the Company.

12. Limitations. A participant shall not have any interest in any Deferred Compensation credited to his or her Deferred Compensation Account until it is distributed in accordance with the Plan. All amounts deferred under the Plan shall remain the sole property of the Company, subject to the claims of its general creditors and available for use for whatever purposes are desired. With respect to Deferred Compensation, a participant shall be merely a general creditor of the Company and the obligation of the Company hereunder shall be purely contractual and shall not be funded or secured in any way. The Plan shall not constitute part of any participant’s or employee’s employment contract with the Company or any participating subsidiary. Participation in the Plan shall not create or imply a right to continued employment.

13. Annual Statements of Account. Account statements shall be sent to participants as soon as practicable following the end of each year as to the balances of their respective Deferred Compensation Accounts as of the end of the previous calendar year.

14. Withholding of Taxes. The Company shall have the right to withhold an amount sufficient to satisfy any federal, state or local income taxes or FICA or medicare taxes that the Company may be required by law to pay with respect to any Deferred Compensation Account, including withholding payment from a participant’s current compensation.

15. No Assignment of Benefits. No rights or benefits under the Plan shall, except as otherwise specifically provided by law, be subject to assignment (except for the designation of beneficiaries pursuant to paragraph (a) of Section 10), nor shall such rights or benefits be subject to attachment or legal process for or against a participant or his or her beneficiary or beneficiaries, as the case may be.

16. Administration Expense. The entire expense of offering and administering the Plan shall be borne by the Company and its participating subsidiaries.

17. Amendment, Modification, Suspension and Termination of the Plan; Rescissions and Corrections. The Compensation Committee, at any time may terminate, and at any time and from time to time, and in any respect, may amend or modify the Plan or suspend any of its provisions; provided, however, that no such amendment, modification, suspension or termination shall, without the consent of a participant, adversely affect such participant’s rights with respect to amounts credited to or accrued in his or her Deferred Compensation Account. The Committee at any time may rescind or correct any deferrals or credits to any Deferred Compensation Account made in error or that jeopardize the intended tax status or legal compliance of the Plan.

18. Indemnification and Exculpation.

(a) Indemnification. Each person who is or shall have been a member of the Compensation Committee or a member of the Deferred Compensation Committee shall be indemnified and held harmless by the Company against and from any and all loss, cost, liability or expense that may be imposed upon or reasonably incurred by such person in connection with or resulting from any claim, action, suit or proceeding to which such person may be or become a party or in which such person may be or become involved by reason of any action taken or failure to act under the Plan and against and from any and all amounts paid by such person in settlement thereof (with the Company’s written approval) or paid by such person in satisfaction of a judgment in any such action, suit or proceeding, except a judgment in favor of the Company based upon a finding of such person’s lack of good faith; subject, however, to the condition that upon the institution of any claim, action, suit or proceeding against such person, such person shall in writing give the Company an opportunity, at its own expense, to handle and defend the same before such person undertakes to handle and defend it on such person’s behalf. The foregoing right of indemnification shall not be exclusive of any other right to which such person may be entitled as a matter of law or otherwise, or any power that the Company may have to indemnify or hold such person harmless.

(b) Exculpation. Each member of the Compensation Committee, each member of the Deferred Compensation Committee, each member of the IPOC and each member of the Investment Process

Committee shall be fully justified in relying or acting in good faith upon any information furnished in connection with the administration of the Plan or any appropriate person or persons other than such person. In no event shall any person who is or shall have been a member of the Compensation Committee, a member of the Deferred Compensation Committee, a member of the IPOC or a member of the Investment Process Committee be held liable for any determination made or other action taken or any omission to act in reliance upon any such information, or for any action (including the furnishing of information) taken or any failure to act, if in good faith.

19. Finality of Determinations; Request for Review. Each determination, interpretation or other action made or taken pursuant to the provisions of the Plan by the Compensation Committee or the Deferred Compensation Committee shall be final and shall be binding and conclusive for all purposes and upon all persons, including, but without limitation thereto, the Company, its stockholders, the Compensation Committee and each of the members thereof, the Deferred Compensation Committee and each of the members thereof, and the directors, officers, and employees of the Company, the Plan participants, and their respective successors in interest. In the event a participant wishes to appeal a decision relating to the Plan, a request in writing may be submitted to the Committee.

20. Governing Law. The Plan shall be governed by and construed in accordance with the laws of the State of Michigan.

Exhibit 12

FORD MOTOR COMPANY AND SUBSIDIARIES

CALCULATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES

AND PREFERRED STOCK DIVIDENDS

(in millions)

				Restated For the Years Ended December 31
	First Nine Months 2006			2005			2004			2003			2002		2001
Earnings
Income before income taxes and cumulative effects of changes in accounting principles (a)	$	(9,363	)	$	1,079		$	4,109		$	914		$	4,036	$	(6,372	)
Less: Equity in net (income)/loss of affiliates included in income before income taxes		(355	)		(303	)		(240	)		(155	)		137		351
Adjusted income		(9,718	)		776			3,869			759			4,173		(6,021	)
Adjusted fixed charges (b)		6,742			9,091			9,136			9,996			10,977		11,911
Earnings	$	(2,976	)	$	9,867		$	13,005		$	10,755		$	15,150	$	5,890

Combined Fixed Charges and Preferred Stock Dividends
Interest expense (c)	$	6,375		$	8,484		$	8,528		$	9,236		$	10,128	$	11,482
Interest portion of rental expense (d)		248			514			565			524			448		394
Preferred Stock dividend requirements of majority owned subsidiaries and trusts		—			—			—			190			353		55
Fixed charges		6,623			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	$	6,623		$	8,998		$	9,093		$	9,950		$	10,951	$	11,953

Ratios
Ratio of earnings to fixed charges		(f	)		1.1			1.4			1.1			1.4		(f	)
Ratio of earnings to combined fixed charges and Preferred Stock dividends		(f	)		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: September 2006 YTD - $45 mil; 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 increased to an amount representing the pre-tax earnings which would be required to cover such dividend requirements based on our effective income tax rates.

(f)	Earnings for the year ended December 31, 2001 were inadequate to cover fixed charges by $6.1 billion.

Earnings for the first nine months 2006 were inadequate to cover fixed charges by $9.6 billion.

Exhibit 15

November 14, 2006

Securities and Exchange Commission

100 F Street, N.E.

Washington, DC 20549

Re:	Ford Motor Company Registration Statements Nos. 2-95018, 2-95020,

33-14951, 33-19036, 33-36043, 33-36061, 33-39402, 33-50194, 33-50238,

33-54275, 33-54283, 33-54348, 33-54735, 33-54737, 33-55847, 33-58255,

33-61107, 33-62227, 33-64605, 33-64607, 333-02735, 333-20725, 333-27993,

333-28181, 333-31466, 333-37396, 333-37536, 333-37542, 333-38580,

333-38586, 333-40258, 333-40260, 333-46295, 333-47443, 333-47445,

333-47733, 333-49545, 333-49547, 333-52399, 333-56660, 333-57596,

333-57598, 333-58695, 333-58697, 333-58701, 333-61882, 333-61886,

333-65703, 333-70447, 333-71380, 333-72476, 333-72478, 333-74313,

333-85138, 333-86127, 333-87619, 333-87990, 333-100910, 333-101293,

333-104063, 333-104064, 333-105674, 333-110105, 333-113584, 333-113608, 333-115339, 333-115340, 333-123251, 333-123252, 333-126865 and 333-132156 on Form S-8 and Nos. 333-67209 and 333-75214 on Form S-3.

Commissioners:

We are aware that our report dated November 14, 2006 on our review of interim financial information of Ford Motor Company (the "Company") for the three-month and nine-month periods ended September 30, 2006 and 2005 included in the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2006 is incorporated by reference in the aforementioned Registration Statements.

As discussed in Note 2 to the interim financial statements, the Company restated its December 31, 2005 and September 30, 2005 financial statements.

Very truly yours,

/s/ PricewaterhouseCoopers LLP

PricewaterhouseCoopers LLP

Detroit, Michigan

Exhibit 31.1

CERTIFICATION

I, Alan Mulally, President and Chief Executive Officer of Ford Motor Company, certify that:

1.	I have reviewed this Quarterly Report on Form 10-Q for the quarter ended September 30, 2006 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;

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):

(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.

Dated: November 14, 2006	/s/ Alan Mulally
	Alan Mulally
	President and Chief Executive Officer

Exhibit 31.2

CERTIFICATION

I, Donat R. Leclair, Jr. Executive Vice President and Chief Financial Officer of Ford Motor Company, certify that:

1.	I have reviewed this Quarterly Report on Form 10-Q for the quarter ended September 30, 2006 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;

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):

(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.

Dated: November 14, 2006	/s/ Donat R. Leclair, Jr.
	Donat R. Leclair, Jr.
	Executive Vice President and
	Chief Financial Officer

Exhibit 32.1

FORD MOTOR COMPANY

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

I, Alan Mulally, President and Chief Executive Officer of Ford Motor Company (the "Company"), hereby certify pursuant to Rule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934, as amended, and Section 1350 of Chapter 63 of Title 18 of the United States Code that to my knowledge:

the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2006, 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

the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: November 14, 2006	/s/ Alan Mulally
	Alan Mulally
	President and Chief Executive Officer

Exhibit 32.2

FORD MOTOR COMPANY

CERTIFICATION OF CHIEF FINANCIAL OFFICER

I, Donat R. Leclair, Jr., Executive Vice President and Chief Financial Officer of Ford Motor Company (the "Company"), hereby certify pursuant to Rule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934, as amended, and Section 1350 of Chapter 63 of Title 18 of the United States Code that to my knowledge:

the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: November 14, 2006	/s/ Donat R. Leclair, Jr.
	Donat R. Leclair, Jr.
	Executive Vice President and
	Chief Financial Officer