New Global C-Car Platform Illustrates ONE Ford Plan in Action

In 2010, Ford will begin manufacturing the all-new Ford Focus, the first vehicle based on our new global "C-car" platform.1 This platform illustrates our ONE Ford plan to leverage our global product development resources to deliver exciting products with best-in-class quality and fuel economy while also reducing costs and improving quality.

Our new C-car platform is truly global; vehicles based on this platform will ultimately be sold in nearly 90 countries. It is also highly flexible; we plan to introduce 10 different C-sized models that use this one platform, which will replace three platforms currently in production regionally. The new Ford Focus will be the first vehicle from this platform available in all our global markets. It will reach dealerships in Europe and North America in early 2011 and in Asia Pacific and Africa in 2012. By 2012, we expect to produce two million vehicles per year globally from this platform. This high volume – and the economies of scale it provides – gives us the opportunity to offer customers around the world an array of new technologies and product features usually reserved for premium vehicles.

A Highly Flexible Platform

The Company's strategy to achieve profitable growth globally from this segment is built on leveraging a highly flexible platform as the basis for a wide range of products. The C-car platform will be used as the basis for four-door sedans, hatchbacks and multi-activity vehicles (similar to wagons or mini-vans). We will deliver this range of body styles by using different "top hats" on the common platform.

The new Ford C-MAX, revealed at the 2009 Frankfurt Motor Show, showcases the platform's flexibility. This vehicle, which will be available in European markets by late 2010, will include a five-door version and a seven-seat, multi-activity vehicle version (a first for Ford) called the Grand C-MAX. The Grand C-MAX will have twin sliding doors and innovative seat design to provide outstanding space and flexibility. A version of the seven-seat Grand C-MAX is also scheduled to launch in North America in late 2011. In 2013, we will introduce hybrid and plug-in hybrid products based on the C-MAX in Europe. These various vehicles exemplify the benefits of platform diversification; they all provide a distinctive alternative to the average sedan with the same footprint as a traditional C-car.

This level of flexibility will allow us to meet the needs of a wider range of consumers and to respond more quickly and effectively to changes in consumer demand. The platform's flexibility and commonality will also reduce the cost of developing new products.

Leveraging Global Product Development Resources

The new C-car platform was created by a single global product development team that was responsible for delivering the next-generation Ford Focus and a family of vehicles in this size segment. This is a new way of working for Ford. Following the ONE Ford approach, we have broken down regional barriers that had previously resulted in different standards that often caused unnecessary re-engineering of products and components. This global vehicle team approach will be used for all of our global products moving forward. The greater global commonality enabled by this approach lowers production costs and allows us to include more advanced technologies and features in affordable vehicles. For example, 80 percent of the parts on the new Focus are common across regions, a significant increase from previous vehicle programs.

Virtual manufacturing tools are a key enabler of our global product development process. The first new Focus was initially built on computers, which allowed all of our global design and production operations to participate in the product development process. Major advancements in computer design and modeling allow us to verify that our new global manufacturing approach is feasible, whether production takes place in Michigan, Chongqing (China), Saarlouis (Germany) or in other plants around the world – even one that is not yet built. For more information on our virtual manufacturing technologies, please see Improving New Product Development Process.

Plants around the world will build the new-generation global cars using shared processes, tools and technologies. Aligning plants in this way saves money. It creates economies of scale by developing common parts and tooling, and it saves on product development and tooling costs. This global approach also helps us deliver advances in quality across all our global operations.

Plants that will build the Focus-based vehicles include:

• The Michigan Assembly Plant in Wayne Michigan, formerly the Michigan Truck Plant, which is being retooled to make fuel-efficient smaller cars
• Saarlouis in Germany, the lead European assembly plant for the Ford Focus since its debut in 1998
• Valencia in Spain, a flexible manufacturing facility building both the Ford Fiesta and Focus models for Ford of Europe
• St. Petersburg in Russia, which builds both the Focus and Mondeo for the European market
• Chongqing in China, a new, state-of-the-art and highly flexible passenger car plant built with Ford's joint venture in China, Changan Ford Mazda Automobile

Strengthening Our Global Supply Base

The principles of Ford's four-year-old Aligned Business Framework (ABF), which sets down guidelines for Ford and suppliers to work together, paved the way for Ford to work effectively with strategic suppliers on a global basis in developing the new C-car platform. For example, ABF allowed Ford to bring in key suppliers for global meetings much earlier in the development process and to provide suppliers with a much greater level of detail on product features and manufacturing volumes and locations than was previously the case. By coordinating with Ford at an earlier stage, suppliers can drive significant cost efficiencies. This also contributes to ensuring consistent levels of excellent quality, whether we're building cars in the United States, Germany or China. In addition, providing a smaller number of suppliers with more business directly supports our ONE Ford goal of creating a viable company that delivers profitable growth for all – including our suppliers.

Taken together, these efforts to develop a common global platform have already driven efficiencies that have allowed Ford to reduce development costs more than 60 percent compared to vehicles developed as recently as 2006.

Designed to Meet Areas of Growing Consumer Demand Globally

Our global C-car platform is not just an internal exercise in global integration, quality improvements and cost reductions. It is also designed to help us better meet the needs of our global consumers.

The new Focus was developed using a global market research process that sought to understand commonalities and differences in consumer demand across our various markets. This research showed that customers increasingly want smaller cars with outstanding fuel economy, but without sacrificing any of the style, technology, connectivity and driving quality they demand from larger vehicles. Our next generation of C-cars show that Ford is ready to meet that challenge. We believe that the Focus combines the best from Europe, North America and Asia to deliver a new kind of small car product that is stylish, fuel efficient, affordable and fun to drive.

The new Focus is positioned to appeal to a major – and growing – international customer segment. One in four vehicles sold worldwide is a C-segment vehicle. C-cars are already the heart of the European car market, a mainstay in the Asia Pacific market and growing in importance in the Americas. Furthermore, consumer research for the next-generation Ford Focus found that customers from all three major regions of the world favored the same kinetic design, eliminating the need for regional differences and strengthening the mandate for a world-class, truly international product.

Our C-car platform vehicles will offer unprecedented levels of driver-convenience features, fuel economy and quality. The platform is designed to carry a wide range of fuel-efficiency and advanced powertrain technologies, to provide consumers with a range of fuel-efficient options. For example, the Ford Focus will use regionally relevant technologies to meet consumer demand for greater fuel efficiency, including EcoBoost™ engines and PowerShift dual-clutch technology, which improve fuel economy by up to 20 and 9 percent respectively compared to traditional engine and transmission technologies. Advanced clean diesels will also be offered in Europe. This platform will also form the base for one of our first commercially available battery electric vehicles – the Focus Electric – which will be available in the United States in 2011.

The C-car platform builds on the success of our global B-car platform, which is the base for the Ford Fiesta. The development of these platforms represents the future of Ford Motor Company and delivers on the promise of our ONE Ford plan. They leverage global resources; deliver exciting products with best-in-class quality and fuel economy; meet growing consumer needs; and deliver profitable growth for all our stakeholders.