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FORD further accelerates product rollout, leverages efficiencies across global markets


* Global Product Acceleration: By 2012, Ford plans to replace or refresh 70 to 90 percent of its vehicle lineups by volume in North America, Europe and Asia Pacific and Africa. By 2014, Ford plans to replace 140 to 160 percent of its lineup by volume in those regions.

* Leaner, more efficient operations: By the end of 2009, Ford is on pace to reduce its structural costs by $14 billion to $15 billion compared with 2005. At the same time, the company has lowered new vehicle engineering costs by 60 percent and reduced new facility and tooling costs by 40 percent.

* Leveraging global platforms: Ford expects to build 680,000 vehicles per core global platform within five years, up from 345,000 today. By 2012, 78 percent of Ford’s global volume will be on core platforms, up from 29 percent in 2007.

* Newer product globally: An unprecedented rollout of high-quality, fuel efficient and safe vehicles is expected to improve Ford’s global product average age by 20 percent by 2014.

TRAVERSE CITY, Mich. – Ford Motor Company today said it plans to further accelerate new product introductions across North America, Europe and Asia Pacific enabled by its efficient global product development system, significant structural cost reductions and disciplined cash management.

By 2012, Ford plans to replace or refresh from 70 to 90 percent of its lineups by volume in each of the company’s three largest business regions – North America, Europe and Asia Pacific and Africa, Lewis Booth, Ford’s chief financial officer, said today in a speech at the 2009 Management Briefing Seminars in Traverse City.

By 2014, Ford plans to replace or refresh 140 to 160 percent of its lineups by volume in North America, Europe and Asia Pacific and Africa. The new products come on top of a host of new vehicle introductions in the past two years that have resulted in Ford’s freshest lineup ever in the U.S. and other markets.

“As we reduce costs, manage cash and increasingly leverage our ‘One Ford’ global product plan, our critical priority is protecting and enhancing our new vehicle pipeline,” Booth said. “In the worst of economic times, we are taking the actions necessary not only to strengthen Ford’s business but also to deliver world-class levels of product freshness globally.”

Ford’s global lineup will benefit from its “One Ford” global product plan, which calls for fewer but higher-volume platforms, global vehicles such as the Fiesta, Focus and Transit Connect, as well as increased parts sharing and commonality. Within five years, Ford expects to have reduced the age of its global product portfolio by 20 percent.

In his presentation, Booth outlined how Ford is dealing with the current economic reality, protecting its product pipeline, repairing its balance sheet and building a foundation for long-term profitable growth. Booth reiterated that Ford is on track to be breakeven or profitable on a pre-tax basis by 2011.

Among its business highlights, Ford:

* Is on pace to achieve $14 billion to $15 billion in structural costs reductions by the end
of 2009, compared to 2005
* Took actions to strengthen its balance sheet in the first half of 2009, including reducing Automotive debt by $10.1 billion, raising $1.6 billion in equity and qualifying for
$5.9 billion in loans from the U.S. Department of Energy for advanced fuel-saving vehicles
* Slowed its operating-related cash outflow from $7.7 billion in third quarter of 2008 to
$7.2 billion in fourth quarter of 2008 to $3.7 billion in first quarter of 2008 to $1 billion
in the second quarter of 2009
* Renegotiated the U.S. labor agreements earlier this year, including both the operating contract and VEBA health care trust
* Improved new vehicle engineering costs by 60 percent from 2006 to 2008 and improved new vehicle facilities and tooling costs by 40 percent in the same time period
* Improved average net revenue per unit in the U.S. by 9 percent in the first half
of 2009 compared with the first half of 2008
* Posted market share gains in all major regions in the second quarter of 2009

As Ford has taken actions to strengthen its underlying business in the midst of the global economic downturn, the company has safeguarded investment in new product. In 2009, 45 percent of Ford’s U.S. vehicle lineup by volume is new or significantly freshened. New products include the 2010 Ford Taurus, 2010 Transit Connect, new 2010 Fusion and Fusion Hybrid and 2010 Lincoln MKT.

In the next five years, Ford’s global product development system will drive an unprecedented product refreshment rate across Ford’s worldwide markets. Ford expects to build 680,000 vehicles per core global platform within five years, up from approximately 345,000 today.
At the same time, Ford has reduced global vehicle nameplates from 97 in 2006 to 59 at the end of 2008, with further reductions planned.

The Ford Transit Connect, already a success in Europe, is now going on sale in North America. The new Fiesta, a breakout hit in Europe and Asia Pacific markets, comes to North America in the first half of 2010. When the next generation global Focus debuts in 2010, it will be sold in all major markets around the world. Within a few years, the Fusion and Mondeo mid-size cars will migrate to a common global platform, as will commercial vans.

As Ford accelerates product introductions around the world, the company said it is committed to delivering product excellence in the areas most important to customers, including:

* Fuel economy: Ford is committed to delivering best-in-class or among the very best fuel economy with every new vehicle it introduces
* Safety: Ford is utilizing active and passive safety technology to deliver leading safety across its lineup
* Quality: Ford has reached parity with the best automakers in initial quality and has made significant strides in long-term durability and craftsmanship as measured by key third parties
* Smart technology: Ford is building on its industry-leading position in offering unique technologies and features that make the driving experience easier, more enjoyable and safer, including Ford SYNC®, Active Park Assist and SIRIUS Travel Link™

“We have made it a business priority to deliver a full lineup of Ford vehicles – small, medium and large cars, utilities and trucks – that aim to be best-in-class in fuel efficiency, quality, technology and safety and available to consumers with exceptional value,” said Derrick Kuzak, group vice president, Global Product Development. “We are making fuel economy a reason to buy a Ford, and we are distinguishing ourselves as leaders in connectivity and unique consumer-friendly technologies.”


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