Letter from William Clay Ford, Jr.

In 2009, I will mark my 10th year as Chairman of Ford Motor Company, and we will celebrate the 10th anniversary of our first sustainability report. The confluence of these two milestones is no coincidence – I have been an environmentalist all of my life and have long believed that sustainability is the most important business issue of our time.

Through the years, this report has helped us track our progress on issues of global concern and share the results with the world. At times, that progress was painfully slow; at other times, we have aimed too high and been unable to deliver on our ambitious plans. Over time, however, our focus has sharpened, our resolve has strengthened and our results have improved.

In 1999, the global economy was booming and Ford was one of the most profitable automakers, based largely on North American sales of SUVs and pickups. In 2009, we are in the midst of the worst recession in generations. Like the global economy, our Company has changed dramatically over the course of the decade. We have accelerated the fundamental restructuring we began in 2006. To be competitive, we have shed jobs, factories and brands. We have struck new agreements with the unions representing our employees to help bring our costs in line with other automakers. Even before the current crisis, we began to reshape our Company to succeed in the new reality of a carbon-constrained economy, setting a carbon dioxide (CO2) emissions-reduction goal for our vehicles and taking a series of actions that include an emphasis on cars, small vehicles and outstanding fuel economy across our lineup.

The good news is that our economic and environmental goals are aligned. In fact, we believe that the best way for us to be more profitable is to make our business and products more sustainable.

This is more than a slogan. Today, thanks to the efforts of thousands of Ford employees around the world, we are offering the highest-quality, safest and most fuel-efficient lineup of cars, trucks and crossover vehicles in our history. We are committed to being the best or among the best in fuel economy in every product segment in which we compete. Our product development strategy includes specific short-, mid- and long-term targets for CO2 reduction, and we have already begun accelerating some of our planned mid-term actions.

In January, we announced an expanded electric vehicle strategy that is aligned with the world's growing interest in advanced technologies that can help reduce the use of petroleum. This aggressive plan will bring pure battery electric vehicles, next-generation hybrid and plug-in hybrid vehicles to market quickly and affordably. It starts with at least four new vehicles in the next four years that will use the most advanced forms of battery technology.

We continue to make progress in engaging with outside stakeholders and listening to different perspectives on a wide range of issues and we look forward to working with the Obama Administration to develop effective energy and climate policies.

Our work continues in other important areas as well. In 2008, we joined the United Nations Global Compact (UNGC), reinforcing our commitment to human rights and other responsibilities of global companies. Ford was invited to join the UNGC Human Rights Working Group, where it is the only manufacturing company represented. In addition, we are leading an initiative with other automakers and working with our suppliers to encourage a strong, consistent approach to protecting human rights throughout the automotive supply chain.

Ten years ago, in the first of these reports, I said: "We're at the most exciting period in the history of the Ford Motor Company. I wouldn't opt to work in any previous period in our history. We are setting off on a path that will transform us from an old-line industrial company into a model company for the 21st century."

The last decade has been even more exciting than I predicted. And we cannot yet claim to be a model company financially, environmentally or socially. But in the last 10 years, the business case for sustainability has been proven over and over again at Ford. It has helped us lower our costs, improve our quality and productivity, and create exciting new products with high customer satisfaction. We really are a different company – one better suited to tackling global sustainability issues and responding to the rapid pace of change in our markets. These changes were reflected at the Board of Directors level when we formed a Sustainability Committee from the former Environment and Public Policy Committee. The principles of sustainability will continue to drive our efforts in the future, and we will continue to share the results of those efforts with you in this report.

William Clay Ford, Jr.
Executive Chairman and Chairman of the Board