Accelerate Development of New Products Our Customers Want and Value

As part of our acceleration of the Way Forward plan, 70 percent of Ford, Lincoln and Mercury products (by volume) in North America will be new or significantly upgraded by the end of 2008 compared with 2006 models. To do this, we will expand our product lineup in growth segments such as crossover vehicles; we are also committed to introducing new products that customers want and value. For more information on our product launches and plans, please see Delivering High-Quality, Innovative Products Globally.

We plan to accelerate the development of new products designed to meet shifting consumer preferences for more fuel-efficient, smaller vehicles. One goal, for example, is to reduce the average age of Ford-brand vehicles in North America by 35 percent by 2009 compared with 2006. To facilitate this, we have reorganized our product development activities into a unified and integrated global organization that reports directly to our Chief Executive Officer, and we are developing a truly global product plan that takes full advantage of our global product development assets, technologies and people. By leveraging our scale, we will be able to deploy our global product development capital and engineering resources to fewer vehicle platforms, drivetrains and powertrains. This commonality of platforms, drivetrains and powertrains, in turn, will reduce complexity in our vehicles and processes. Moreover, as we make our investments in new products, we will continue to improve our production system's quality, productivity and flexibility.

As an example of how commonality can work for us, the new Fiesta compact car that we are introducing in Europe in 2008 also will be offered for sale in all major markets, including the United States, over the next few years. We discuss our global integration plans and achievements in more detail later in this section.