Ford Reports Third Quarter Results of 2007

Ford's third-quarter revenue was $41.1 billion, up from $37.1 billion a year ago. The increase primarily reflected higher net pricing, changes in currency exchange rates, and improved product mix.

Ford's third-quarter loss from continuing operations, excluding special items, was 1 cent per share, or $24 million, compared with a loss of 45 cents per share, or $850 million, in the same period a year ago.**

Special items reduced pre-tax results by $350 million in the third-quarter. These were more than explained by costs associated with our previously announced Trust Preferred Securities exchange offer, and charges associated with Ford Europe and PAG personnel reductions and other restructuring actions. Favorable cost adjustments associated with Ford North America personnel reduction programs were a partial offset.

Automotive gross cash, which includes cash and cash equivalents, net marketable securities, loaned securities and short-term VEBA assets, was $35.6 billion at Sept. 30, 2007, an increase of $1.7 billion from year-end 2006.

The company continues to explore in greater detail the potential sale of Jaguar and Land Rover with interested parties and anticipates these discussions will culminate in an agreement no later than early next year.

In addition, the company has been conducting a strategic review of Volvo, and has developed a plan. The first priority of the plan is to improve financial performance at Volvo. The plan also includes: enhancing Volvo's position as a global producer of premium vehicles; establishing appropriate business arrangements between Volvo and Ford-brand operations to allow Volvo to operate on a more stand-alone basis in the absence of the PAG structure; and, continuing to achieve synergies between Ford-brand operations and Volvo in areas such as product development and purchasing. The company plans to disclose Volvo's financial performance beginning with 2008 results.

"Our third-quarter performance is very encouraging," said Ford President and Chief Executive Officer Alan Mulally. "We can see our plan taking hold with significant improvement continuing in our core Automotive operations. We remain committed to executing the four priorities of our plan - restructuring the business to operate profitably, accelerating the development of new products that our customers want and value, funding our plan and improving our balance sheet, and working even more effectively together as one Ford team, leveraging our global assets."

Highlights for 2007 thus far include:

Tentative agreement reached with the United Auto Workers (UAW) on a new four-year national labor contract, subject to ratification by UAW members, which significantly improves our competitiveness going forward.
Strong performance in the 2007 Third Quarter U.S. Global Quality Research System (GQRS) study.
Ford Taurus, Taurus X and Mercury Sable earned Top Safety Pick ratings from the Insurance Institute for Highway Safety (IIHS) for achieving the highest possible ratings in frontal, side and rear crash test performance.
The Ford Mustang convertible became the first sports car and first convertible in history to earn the highest possible safety ratings from the National Highway Traffic and Safety Administration (NHTSA). The Mustang convertible earned five star ratings in all crash test and rollover categories.
Ford SYNC - the company's fully integrated, voice-activated in-car communications and entertainment system developed in association with Microsoft - won one of 10 Popular Mechanics' "Breakthrough Awards" which recognize products that set new benchmarks in design, creativity and engineering.
Ford South America unit sales up 19 percent year-to-date.
Ford Europe records sixth consecutive quarter of year-over-year profit improvement, and Ford Europe unit sales rose more than 5 percent in first nine months of 2007.
Ford Mondeo joins three other models - Ford Focus, Galaxy and S-MAX - with a five star performance on the Euro NCAP top 10 list, reinforcing Ford Europe's position as the manufacturer with the highest number of vehicles in the top 10 for adult occupant protection.
Best-ever quarter for Land Rover unit sales.
Ford China unit sales up 27 percent in the first nine months of 2007.
Launched operations at new assembly plant in Nanjing, China . The new plant will produce the latest small-car models from both Ford and Mazda.
Achieved $1.8 billion in cost savings in first nine months of 2007, including $600 million in the third quarter (at constant volume, mix and exchange; excluding special items).
Continued to align capacity to match demand and improve our productivity in North America, reducing personnel by 6,800 in the third-quarter. -Ford