Letter from William Clay Ford, Jr.

Since we released our first report on this subject in 1999, sustainability at Ford Motor Company has evolved from an idealistic vision into a core part of our business. Our commitment to responsibly use our resources to create long-term value has guided us successfully through periods of rapid change and shifting markets. It has helped us to be successful as a corporate citizen and as a global competitor.

Creating long-lasting benefits for all of our stakeholders starts with a business model that is economically sustainable. Our ONE Ford plan enables us to fully leverage our worldwide resources by operating as a single global enterprise. Under this plan we emerged from the economic downturn as a vibrant, growing business. We have been solidly profitable since 2010, and we continue to invest in and expand our operations around the world, taking advantage of the flexibility our global vehicle platforms provide us.

Improving Our Product and Manufacturing Footprint

Our strong showing in the electrified vehicle market is a good example of how great products can help build a strong business as well as a better world. In 2012, we introduced six new electrified vehicles in North America, including hybrid, plug-in hybrid and pure battery electric models. By offering a variety of vehicles, we make it easier for customers to embrace these fuel-saving technologies. As a result of our aggressive move into this growing segment, we set sales and market share records for our hybrid vehicles in 2012, and that strong momentum continues in 2013.

Also in 2012, we announced a five-year strategy to reduce our global waste to landfill by 40 percent per vehicle between 2011 and 2016. This waste goal complements our multiyear per-vehicle facility goal to cut water use and carbon dioxide (CO₂) emissions. On the product side, we continue to make good progress on our ongoing, science-based goal to reduce vehicle CO₂ emissions enough to make a measurable contribution to combating climate change.

Supporting People Globally

I believe the fundamental purpose of a corporation is to make people’s lives better, and we can do that by creating outstanding products, by investing in the communities where our employees live and work, and by using our position as a technology leader to tackle global sustainability challenges.

We consider our people to be our most important resource, and I am very proud of our initiatives related to human rights. We adopted our human rights code in 2003 to help ensure our employees around the world are afforded dignity and safety in their work environment. Our guidelines have evolved over the years and our commitment to environmental and social sustainability, as well as to human rights throughout our global operations, has expanded. We have also reinforced our commitment to the people who work in our supply chain. We have led collaborations with our key suppliers and other automakers to embed this approach across the industry.

Addressing Mobility Challenges

We are also looking at the impact our products will have in the future, when urban mobility, climate change and other challenges will dramatically alter the nature of private car ownership. We already are beginning to see these changes unfold and we need to proactively be ready for them. To explore these trends, Ford examined the demographic and logistical realities that will shape transportation over the next several decades, and we have used these projections to shape our path going forward.

Increased global population and prosperity could double the number of vehicles in the world by mid-century. With so many more drivers on the road, wireless communication among vehicles, infrastructure and the Internet will be needed to make driving safer and more efficient. To help guide our efforts in this area, in 2012 we outlined our Blueprint for Mobility, which outlines what we believe transportation will look like by mid-century and beyond, and the technologies, business models and partnerships needed to get there. In short, it maps out our strategy to provide sustainable transportation that is affordable in every sense of the word – economically, environmentally and socially.

We have created this blueprint because we believe mobility is a human rights issue: Access to and ease of transportation make a substantial difference in a society’s quality of life. Combining transportation and technology will help reduce the time and resources lost circling urban areas looking for parking, clear crowded highways that slow vital goods from flowing freely, and prevent traffic jams that can stop emergency vehicles in their tracks.

Ford has been committed to the development of connected vehicle communications for more than a decade, and this commitment can be seen in our latest efforts in the U.S. and Europe.

In 2012, a number of automakers, including Ford, began working with the U.S. Department of Transportation and the University of Michigan on a pilot safety study in Ann Arbor, Michigan. Wireless devices were installed in 3,000 vehicles to evaluate the effectiveness of connected vehicle technology in preventing crashes.

In Europe, Ford also is working on two joint research projects to test vehicle-to-vehicle and vehicle-to-infrastructure communication systems under real-world conditions. One is with the German government and the other with a consortium of 29 partners. We provided 20 vehicles for the Germany test, which began in Frankfurt in July 2012.

We also are looking at emerging business models that will change the future transportation landscape.

In 2013, Ford is launching FORD2GO in Germany, the first automotive manufacturer-backed, nationwide car-sharing program in Europe to incorporate dealerships. The program calls for participating Ford dealers across Germany to offer cars and service to customers in their communities, allowing easy access to shared cars and the opportunity for potential customers to experience Ford vehicles while reducing the total number of vehicles on the road.

We are also bringing the benefits of mobility and Internet cloud computing deep into the developing world. In 2012, Ford piloted the SUMURR (Sustainable Urban Mobility with Uncompromised Rural Reach) program in India, combining health applications on mobile phones and the off-road capabilities of a Ford Endeavour to extend the physical reach of maternal care to 3,100 people in 54 remote villages in a rural part of the country. SUMURR serves as a tangible demonstration of the synergy that can be achieved through our products, technology and partnerships to make a genuine difference in the lives of people around the globe.

Looking to the Future

From these exciting wireless communications projects to our efforts to strengthen our financial position and reduce our environmental impact, Ford is deeply committed to sustainability. New technologies and a more open, collaborative approach are helping us achieve breakthroughs we could only dream of in 1999, and we are eager to go further. It is an exciting time for us as we continue on our journey to build great products, a strong business and a better world.

William Clay Ford, Jr.
Executive Chairman