Voluntary Separation Program
Ford Motor Co
17 August 2001
Contact:
Anne Marie Gattari
1.313.322.9211
agattari@ford.com
Todd Nissen
1.313.594.4410
tnissen@ford.com
Media Information Center
1.800.665.1515 or
1.313.621.0504
media@ford.com
FORD MOTOR COMPANY ANNOUNCES
VOLUNTARY SEPARATION PROGRAM,
LOWERS EARNINGS FORECAST
DEARBORN, Mich., Aug. 17 - Ford Motor Company announced today it is offering a
voluntary separation program for selected salaried employees as the first part
of renewed efforts to strengthen its competitive position and increase
efficiencies.
By the end of the year, Ford will reduce the number of salaried positions in
North America by 4,000 - 5,000. The reduction in positions will be achieved
largely through retirements. Ford expects to record a one-time, after-tax charge
of about $700 million, or 40 cents per share, in the fourth quarter to cover the
cost of this action.
Ford also expects to report an after-tax, non-cash charge in the third quarter
of approximately $200 million, or about 10 cents per share, resulting mainly
from the write-down of certain investments in e-commerce and automotive-related
ventures.
In addition, Ford now expects full-year 2001 earnings to be about 70 cents per
share, before the one-time charges. The present analyst consensus for the year
is $1.20. The reduction is mainly attributed to lower volume, higher marketing
expenses and costs for customer satisfaction initiatives.
'The voluntary separation program is a difficult but necessary action,' said
Jacques Nasser, president and CEO. 'These actions will help us operate the
business more efficiently, streamline our organization and align our skill base
with future needs. We will work proactively with those who decide to participate
in the program to assist them in their transition to new roles, either in
retirement or other employment.'
The voluntary separation program is part of Ford's efforts to improve business
efficiencies in the face of competitive actions. Other actions already taken
this year include targeted reductions in capacity such as eliminating a shift at
Michigan Truck; eliminating overtime at several other North American assembly
plants; implementing a hiring freeze; and reducing travel, contract worker and
other expenses.
'The North American market has become fiercely competitive. Although we have
reduced total costs nearly $7 billion over the last four years, we need to
continue to accelerate our efforts to improve our efficiencies, while protecting
important new product plans,' Nasser said.
Ford Chief Financial Officer Martin Inglis and David Murphy, vice president,
human resources, will hold a conference call for analysts at 10 a.m. EDT today
to discuss the earnings announcement and voluntary separation program. Reporters
will have an opportunity to ask questions at the end of the analyst briefing.
The number is 703-871-3026. The conference call can also be heard on the
Internet at www.streetfusion.com and www.streetevents.com. Copies of the
conference call slides can be viewed with the press release on the Internet at
www.shareholder.ford.com or media.ford.com. Replays of the call will be
available starting at 1 p.m. EDT through 11:59 p.m. EDT Aug. 22 either on the
Internet at www.streetfusion.com and www.streetevents.com or by phone at
703-925-2533, passcode 5469973.
Statements included herein may constitute 'forward looking statements' within
the meaning of the Private Securities Litigation Reform Act of 1995. These
statements involve a number of risks, uncertainties, and other factors that
could cause actual results to differ materially from those stated, including,
without limitation: greater price competition in the U.S. and Europe resulting
from currency fluctuations, industry overcapacity or other factors; a
significant decline in industry sales, particularly in the U.S. or Europe,
resulting from slowing economic growth; lower-than-anticipated market acceptance
of new or existing products; currency or commodity price fluctuations; economic
difficulties in South America or Asia; higher fuel prices; a market shift from
truck sales in the U.S.; lower-than-anticipated residual values for leased
vehicles; a credit rating downgrade; labor or other constraints on our ability
to restructure our business; increased safety or emissions regulation resulting
in higher costs and/or sales restrictions; work stoppages at key Ford or
supplier facilities; and the discovery of defects in vehicles resulting in
recall campaigns, increased warranty costs or litigation
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