Ford Motor Company Announces Voluntary Separation Program

    DEARBORN, Mich., Aug. 17 Ford Motor Company announced
today it is offering a voluntary separation program for selected salaried
employees as the first part of renewed efforts to strengthen its competitive
position and increase efficiencies.

    By the end of the year, Ford will reduce the number of salaried positions
in North America by 4,000 - 5,000.  The reduction in positions will be
achieved largely through retirements.  Ford expects to record a one-time,
after-tax charge of about $700 million, or 40 cents per share, in the fourth
quarter to cover the cost of this action.

    Ford also expects to report an after-tax, non-cash charge in the third
quarter of approximately $200 million, or about 10 cents per share, resulting
mainly from the write-down of certain investments in e-commerce and
automotive-related ventures.

    In addition, Ford now expects full-year 2001 earnings to be about 70 cents
per share, before the one-time charges.  The present analyst consensus for the
year is $1.20.  The reduction is mainly attributed to lower volume, higher
marketing expenses and costs for customer satisfaction initiatives.

    "The voluntary separation program is a difficult but necessary action,"
said Jacques Nasser, president and CEO.  "These actions will help us operate
the business more efficiently, streamline our organization and align our skill
base with future needs. We will work proactively with those who decide to
participate in the program to assist them in their transition to new roles,
either in retirement or other employment."

    The voluntary separation program is part of Ford's efforts to improve
business efficiencies in the face of competitive actions.  Other actions
already taken this year include targeted reductions in capacity such as
eliminating a shift at Michigan Truck; eliminating overtime at several other
North American assembly plants; implementing a hiring freeze; and reducing
travel, contract worker and other expenses.

    "The North American market has become fiercely competitive.  Although we
have reduced total costs nearly $7 billion over the last four years, we need
to continue to accelerate our efforts to improve our efficiencies, while
protecting important new product plans," Nasser said.