Ford Reports Q1 2006 Financial Results

- Ford Credit pre-tax profit of $751 million, excluding special items.

DEARBORN, Mich., April 21 /PRNewswire-FirstCall/ -- Ford Motor Company (NYSE: F) today reported a net loss of 64 cents per share, or $1.2 billion, for the first quarter of 2006. This compares with net income of 60 cents per share, or $1.2 billion, in the first quarter of 2005.

Ford's first-quarter earnings from continuing operations, excluding special items, was 24 cents per share, or $458 million.*

Ford's total sales and revenue in the first quarter was $41.1 billion, down $4.1 billion from a year ago.

    * Earnings per share from continuing operations excluding special items is
      calculated on a basis that includes pre-tax profit and provision for
      taxes and minority interest.  See table following "Safe Harbor/Risk
      Factors" for the nature and amount of these special items and a
      reconciliation to GAAP.

"I am confident that we are confronting our challenges head-on and that we will succeed in our turnaround and getting back on track to ensure our long-term success," said Chairman and Chief Executive Officer Bill Ford. "We are clearly in a period of transition. However, I am pleased with the changes underway to make Ford a leaner, more innovative company. I also am grateful to our employees for the cooperation and confidence in Ford that they have demonstrated by embracing these changes, which can be very difficult."

Special items reduced earnings by 88 cents per share in the first quarter. The pre-tax effect of these items include:

    -- A charge of $1.7 billion, or 61 cents per share, for costs associated
       with expected North America Way Forward-related layoff and jobs bank
       benefits and voluntary termination packages;
    -- A charge of $414 million, or 14 cents per share, of related non-cash
       pension curtailment charges;
    -- Facility-related costs, primarily associated with last month's idling
       of the St. Louis Assembly Plant, of $281 million or 10 cents per share;
       and
    -- Costs of $95 million, or 3 cents per share, associated with additional
       personnel reduction programs not directly related to Way Forward.

    First-quarter highlights included:
    -- Launched Way Forward plan to return North America automotive operations
       to profitability no later than 2008.  Plan includes idling and ceasing
       operations at 14 manufacturing facilities through 2012, including seven
       vehicle assembly plants, and initiatives to generate net material cost
       savings of at least $6 billion by 2010, improve quality and invest in
       new products.
    -- Introduced U.S. products that are performing well in the marketplace,
       including Ford Fusion, Mercury Milan and Lincoln Zephyr.
    -- Launched all-new Ford Ranger in Thailand, Ford Fiesta in India, Ford
       Focus in China and confirmed Volvo S40 would also be locally produced
       in China.
    -- Best ever first quarter global sales for Land Rover, increasing 26
       percent over a year ago.

The following discussion of the results of our Automotive sector and Automotive business units is on a basis that excludes special items. See table following "Safe Harbor/Risk Factors" for the nature and amount of these special items and a reconciliation to GAAP.

AUTOMOTIVE SECTOR

On a pre-tax basis, excluding special items of $2.5 billion, worldwide Automotive sector losses in the first quarter were $184 million. This compares with a pre-tax profit of $580 million, excluding special items of $107 million, during the same period a year ago.

Worldwide automotive sales for the first quarter declined to $37.0 billion from $39.3 billion in the same period last year. Worldwide vehicle unit sales in the quarter were 1,722,000, up from 1,716,000 a year ago.

Total cash, including automotive cash, marketable securities, loaned securities and short-term Voluntary Employee Beneficiary Association (VEBA) assets at March 31, 2006 was $23.7 billion, down from $25.1 billion at the end of the fourth quarter.

THE AMERICAS

For the first quarter, The Americas reported a pre-tax automotive loss of $323 million, excluding special items, compared to a pre-tax profit of $741 million in the same period a year ago.

North America: In the first quarter, Ford's North America automotive operations reported a pre-tax loss of $457 million, excluding special items, compared with a pre-tax profit of $664 million, excluding special items, a year ago. The deterioration primarily reflected lower volumes associated with lower market share and a smaller increase in dealer inventories; increased incentives associated with a higher mix of leasing and fleet sales; the non- recurrence of favorable warranty reserve adjustments; acceleration of depreciation charges associated with announced plant idlings; adverse currency exchange; and losses associated with ACH, the former Visteon activities now controlled by Ford. These declines were partially offset by lower net product costs and other improvements primarily associated with implementation of our personnel and capacity reduction actions. Sales were $19.8 billion, down from $21.1 billion for the same period a year ago.

South America: Ford's South America automotive operations reported a first-quarter pre-tax profit of $134 million, an increase of $57 million from a $77 million pre-tax profit a year ago. Pricing and higher industry volume, partially offset by higher commodity prices, were the primary drivers of the improvement. Sales for the first quarter improved to $1.2 billion from $866 million in 2005.

INTERNATIONAL OPERATIONS

In the first quarter, International Operations reported a combined automotive pre-tax profit, excluding special items, of $301 million, an improvement of $200 million from first quarter 2005.

FORD EUROPE AND PREMIER AUTOMOTIVE GROUP (PAG)

The combined first-quarter automotive pre-tax profit, excluding special items, for Ford Europe and PAG automotive operations was $254 million, an improvement of $250 million from the same period a year ago.

Ford Europe: Ford Europe's first-quarter pre-tax profit was $91 million, excluding special items, compared with a pre-tax profit of $59 million during the 2005 period. The improvement was more than explained by cost reductions, primarily material costs, and favorable mix, partially offset by lower net pricing. During the first quarter, Ford Europe negotiated an investment security agreement with the German works council that provides job protection while achieving a more competitive manufacturing cost base. Ford Europe's sales in the first quarter were $6.8 billion, compared with $7.7 billion during first quarter 2005.

Premier Automotive Group (PAG): PAG reported a pre-tax profit, excluding special items, of $163 million for the first quarter, compared with a pre-tax loss of $55 million for the same period in 2005. The improvement primarily reflected cost improvements at Volvo, Jaguar, and Land Rover and increased sales of Range Rover Sport, contributing to improved mix. The improvements were partially offset by unfavorable currency exchange and lower net pricing. First-quarter sales for PAG were $7.1 billion, compared with $7.6 billion a year ago.

ASIA PACIFIC AND AFRICA/MAZDA

In the first quarter, Asia Pacific and Africa/Mazda reported a combined pre-tax profit of $47 million, compared with a pre-tax profit of $97 million in 2005.

Asia Pacific and Africa: For the first quarter, Asia Pacific and Africa reported a pre-tax profit of $2 million, compared with a pre-tax profit of $43 million a year ago. The decline primarily reflected lower Falcon volumes in Australia, unfavorable currency exchange, and the non-recurrence of last year's sale of our interest in Mahindra & Mahindra in India, partially offset by improved performance in our joint ventures, primarily in China. Sales were $1.7 billion, compared with $2.0 billion in 2005.

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