Ford Motor Company today reported net income of $100 million, or 5 cents per share, for the first quarter of 2008.  This compares with a net loss of $282 million, or 15 cents per share, in the first quarter of 2007.     

Ford’s first quarter pre-tax operating profit from continuing operations, excluding special items, was $736 million, up $669 million from a year ago.  On an after-tax basis, Ford’s first quarter operating profit from continuing operations, excluding special items, was $525 million, or 20 cents per share, compared with a loss of $172 million, or 9 cents per share, in the same period a year ago. 

Ford’s first quarter revenue, excluding special items, was $39.4 billion, down from $43 billion a year ago.  Adjusted to exclude Jaguar Land Rover and Aston Martin from 2007 results, revenue would have been up slightly, with favorable exchange about offset by lower volume and net pricing.

Special items reduced pre-tax results by $416 million, or 15 cents per share, in the first quarter. These primarily reflected charges associated with personnel actions, dealer reduction actions and the restructuring of our investment in Ballard.  

Automotive gross cash, which includes cash and cash equivalents, net marketable securities and loaned securities, was $28.7 billion at March 31, 2008, a decrease of $5.9 billion from 2007 year-end levels.  The decrease was consistent with our plan and primarily reflects implementation of the initial part of our VEBA agreement with the UAW.     

 “The results of this quarter are encouraging, particularly our outstanding performance in Europe and South America,” said Ford President and CEO Alan Mulally. “In the past several years, we have substantially restructured these businesses.  We believe this is an indication that our efforts to leverage Ford’s global assets across the world will bear fruit.  Going forward, we remain committed to our key business objectives, including our goal of reaching North America and overall Automotive profitability in 2009 despite the challenging economic conditions.”   

 FIRST QUARTER HIGHLIGHTS:

• Posted strong profits of $739 million in Ford Europe and $257 million in Ford South America.  
• Improved Ford North America results by nearly $600 million compared with the first quarter of 2007.
• Achieved $1.7 billion in cost savings, including $1.2 billion in Ford North America (at constant volume, mix and exchange; excluding special items).
• Improved productivity in North America; achieved agreement to reduce U.S. hourly personnel by an additional 4,200 through our recent enterprise-wide buyout program.
• Agreed to sell Jaguar Land Rover to Tata Motors with expected closure in the second quarter.
• Further integrated our global Product Development and Purchasing functions.  These actions will accelerate new vehicle development, improve quality and reduce costs.
• Introduced the Ford Fiesta, our all-new global small car, at the Geneva Motor Show.  Fiesta will be sold in virtually all of our major worldwide markets by 2010.
• Improved initial quality in North America by 8 percent in our most recent survey, putting Ford at parity with Honda and Toyota as the best in the industry. 

AUTOMOTIVE SECTOR

Automotive Sector*	First Quarter
	2008	O/(U) 2007
Wholesales (000)	1,531	(119)
Revenue (Bils.)	$     35.0	$     (3.6)
Pre-Tax Profits (Mils.)	669	895
*excludes special items

For the first quarter of 2008, Ford’s worldwide Automotive sector reported a pre-tax profit of $669 million, compared with a pre-tax loss of $226 million during the same period a year ago.  The improvement was more than explained by favorable cost performance of $1.7 billion in the quarter, partially offset by unfavorable changes in volume and mix ($700 million), and currency exchange ($200 million).  The cost performance included favorable net product costs, manufacturing costs, spending-related costs and expenses for warranty and retiree health care.

Worldwide Automotive revenue for the first quarter of 2008 was $35 billion, down from $38.6 billion a year ago.  Total company vehicle wholesales in the first quarter were 1,531,000, compared with 1,650,000 units a year ago, down because of the exclusion of Jaguar Land Rover and Aston Martin volume in 2008 and lower wholesales in other regions.    

North America: For the first quarter, North America Automotive operations reported a pre-tax loss of $45 million, compared with a loss of $613 million a year ago.  The improvement reflected cost reductions of $1.2 billion, including lower structural and product costs.  These improvements were partly offset by unfavorable volume and mix, and net pricing.  First quarter revenue was $17.1 billion, down from $18.5 billion a year ago.

South America: For the first quarter, Ford’s South America operations posted a pre-tax profit of $257 million, up from $113 million a year ago.  The improvement reflected higher net pricing and volume and mix, partially offset by increased costs, which included higher commodity costs.  First quarter revenue increased to $1.8 billion, up from $1.3 billion a year ago.  

Ford Europe: For the first quarter, Ford Europe pre-tax profits were $739 million, up from $219 million a year ago.  The improvement was primarily explained by favorable cost performance and net pricing, partially offset by unfavorable changes in currency.  First quarter revenue was $10.2 billion, an improvement from $8.6 billion a year ago. 

Volvo: For the first quarter, Volvo reported a pre-tax loss of $151 million, compared with a profit of $94 million a year ago.  The decline was mainly due to unfavorable volume and mix, and changes in currency exchange rates, partially offset by cost reductions.  First quarter revenue was $4.2 billion, compared with $4.6 billion a year ago.

Asia Pacific Africa: For the first quarter, Asia Pacific Africa reported a pre-tax profit of $1 million, compared with a pre-tax loss of $26 million a year ago.  The improvement primarily reflected favorable cost performance and higher profits in China, partially offset by unfavorable exchange and product mix, primarily in Australia.  First quarter revenue was $1.7 billion, compared with $1.8 billion in 2006.

Mazda: Ford earned $49 million from its investment in Mazda and associated operations in the first quarter, compared with $21 million a year ago.  

Other Automotive: Other Automotive, which consists of interest and financing-related costs, accounted for a first quarter pre-tax loss of $181 million. This included net interest expense of $472 million and favorable fair market value adjustments of $291 million, primarily related to the impact of changes in exchange rates on intercompany loans.