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Visteon Announces First Quarter 2006 Results and Raises Full Year Guidance

Highlights * First quarter 2006 net income of $3 million - up $166 million versus 2005 * Strong momentum implementing three-year plan * Full-year 2006 EBIT-R guidance raised * Product sales of $2.8 billion * Significant business wins strengthen customer diversification

VAN BUREN TOWNSHIP, Mich., May 2 -- Visteon Corporation today announced improved first quarter results for 2006 showing strong progress toward implementing its three-year plan. For the first quarter 2006, Visteon reported net income of $3 million or $0.02 per share, a significant improvement over first quarter 2005 results of a net loss of $163 million, or $1.30 per share.

"We are pleased with the improvement in our performance in the first quarter and the momentum we are gaining on implementing our three-year plan," said Michael F. Johnston, chairman and chief executive officer. "Our operating results were better than both the first and fourth quarters of 2005, and we have made solid progress restructuring our organization, improving our base operations and growing our global business."

"Our improved performance is driven by the significant actions we are taking across all of our operations," Johnston added. "We know there is still much work to be done. We have clear plans in place to achieve our objectives, and we are looking for every opportunity to accelerate our three-year plan."

First Quarter 2006 Results

For the first quarter 2006, product sales were $2.8 billion and services sales totaled $145 million. Sales for the same period a year ago totaled $5.0 billion. Product sales were lower primarily due to the Oct. 1, 2005, transaction with Ford that transferred 23 Visteon facilities to Automotive Components Holdings, LLC, a Ford-managed business entity.

"Our balanced portfolio positions us for future growth," Johnston noted. "We have a solid new business backlog and have started the year with some impressive wins that further diversify our customer base."

For the first quarter 2006, Visteon recorded net income of $3 million, or $0.02 per share compared to a net loss of $163 million, or $1.30 per share, in the first quarter of 2005.

Free cash flow was a use of $117 million for the quarter and improved by $26 million from the fourth quarter 2005, despite normal seasonality. Free cash flow was lower than the first quarter 2005 in which Visteon first received the benefit of accelerated payment terms from Ford as part of a financial agreement announced March 10, 2005.

As of March 31, 2006, Visteon had $881 million of cash, a $16 million increase over the balance on Dec. 31, 2005. Total debt for the company as of March 31, 2006, was $2.08 billion, up marginally from year-end 2005. As of March 31, 2006, Visteon was well within the limits of its financial covenants

in its existing credit facilities and expects to remain in compliance throughout the year.

"Cash flow improved from the prior quarter because of the heightened focus and tighter controls on spending we have implemented across the company," said James F. Palmer, executive vice president and chief financial officer. "We have made progress while continuing to invest in the business at appropriate levels, and we remain committed to taking additional steps to strengthen our cash flow position."

Outlook

Visteon is raising its estimate for 2006 full-year for EBIT-R to a range of $120 million to $150 million. Additionally, the company still expects to generate about $50 million of free cash flow for 2006.

"We have confidence in our continued improvement," Johnston added. "We are increasing our outlook for EBIT-R, reaffirming our outlook for positive free cash flow and reiterating our expectation for continued improvement in 2007 and beyond."

Visteon Corporation is a leading global automotive supplier that designs, engineers and manufactures innovative climate, interior, electronic and lighting products for vehicle manufacturers, and also provides a range of products and services to aftermarket customers. With corporate offices in Van Buren Township, Mich. (U.S.); Shanghai, China; and Kerpen, Germany; the company has more than 170 facilities in 24 countries and employs approximately 50,000 people.

                   VISTEON CORPORATION AND SUBSIDIARIES
                  CONSOLIDATED STATEMENTS OF OPERATIONS
               (Dollars in Millions, Except Per Share Data)
                               (Unaudited)

                                                      Three-Months Ended
                                                           March 31

                                                      2006           2005
  Net sales
     Product                                        $2,816         $4,987
     Services                                          145              -
                                                     2,961          4,987
  Cost of sales
     Product                                         2,573          4,840
     Services                                          144              -
                                                     2,717          4,840
  Gross margin                                         244            147
  Selling, general and administrative expenses         168            250
  Restructuring expenses                                 9              7
  Reimbursement from Escrow Account                      9              -
  Operating income (loss)                               76           (110)
  Interest expense, net                                 39             29
  Equity in net income of non-consolidated affiliates    7              6
  Income (loss) before income taxes and minority
   interests in consolidated subsidiaries and
   cumulative effect of change in accounting            44           (133)
  Provision for income taxes                            30             22
  Minority interests in consolidated subsidiaries        7              8
  Net income (loss) before cumulative effect of
   change in accounting                                  7           (163)
  Cumulative effect of change in accounting, net
   of tax                                               (4)             -
  Net income (loss)                                     $3          $(163)

  Per share data:
  Basic and diluted earnings (loss) per share
   before cumulative effect of change in accounting  $0.05         $(1.30)
  Cumulative effect of change in accounting, net
   of tax                                            (0.03)             -
  Basic and diluted earnings (loss) per share        $0.02         $(1.30)
  Average shares outstanding (millions)
  Basic                                              127.1          125.6
  Diluted                                            127.2          125.6

                   VISTEON CORPORATION AND SUBSIDIARIES
                       CONSOLIDATED BALANCE SHEETS
                          (Dollars in Millions)

                                                  (Unaudited)
                                                    March 31     December 31
                                                      2006           2005

                         ASSETS

  Cash and equivalents                                $881           $865
  Accounts receivable, net
     Ford Motor Company                                584            618
     Non-Ford Motor Company                          1,180          1,120
  Inventories, net                                     544            537
  Prepaid expenses and other current assets            229            205

  Total current assets                               3,418          3,345

  Equity in net assets of non-consolidated
   affiliates                                          234            226
  Property and equipment, net                        2,994          2,973
  Other assets                                         172            192

  Total assets                                      $6,818         $6,736

           LIABILITIES AND SHAREHOLDERS' DEFICIT

  Short-term debt, including current portion of
   long-term debt                                     $234           $485
  Accounts payable                                   1,764          1,803
  Employee benefits, including pensions                245            233
  Accrued expenses and other current liabilities       394            438

  Total current liabilities                          2,637          2,959

  Long-term debt                                     1,849          1,509
  Postretirement benefits other than pensions          727            724
  Postretirement benefits payable to Ford Motor
   Company                                             130            154
  Employee benefits, including pensions                646            647
  Deferred income taxes                                191            175
  Other liabilities                                    416            382
  Minority interests in consolidated subsidiaries      237            234

  Shareholders' deficit
     Preferred stock (par value $1.00, 50 million
      shares authorized, none outstanding)               -              -
     Common stock (par value $1.00, 500 million
      shares authorized, 131 million shares
      issued, 128 million and 129 million shares
      outstanding, respectively)                       131            131
     Stock warrants                                    127            127
     Additional paid-in capital                      3,397          3,396
     Accumulated deficit                            (3,437)        (3,440)
     Accumulated other comprehensive loss             (202)          (234)
     Other                                             (31)           (28)

  Total shareholders' deficit                          (15)           (48)
  Total liabilities and shareholders' deficit       $6,818         $6,736

                   VISTEON CORPORATION AND SUBSIDIARIES
                  CONSOLIDATED STATEMENTS OF CASH FLOWS
                          (Dollars in Millions)
                               (Unaudited)

                                                      Three-Months Ended
                                                           March 31
                                                      2006          2005

  Cash provided from (used by) operating activities
  Net income (loss)                                     $3         $(163)
  Adjustments to reconcile net income (loss)
   to net cash provided from operating activities:
    Depreciation and amortization                      102           176
    Equity in net income of non-consolidated
     affiliates, net of dividends remitted               7             3
    Other non-cash items                               (23)           22
  Changes in assets and liabilities:
    Accounts receivable                                  2           (23)
    Inventories                                          1           (58)
    Accounts payable                                   (99)          140
    Other assets and liabilities                       (25)           81

  Net cash (used by) provided from
   operating activities                                (32)          178

  Cash provided from (used by) investing activities

  Capital expenditures                                 (85)         (127)
  Acquisitions and investments in joint ventures, net    -            (9)
  Proceeds from asset disposals                          7            19

  Net cash used by investing activities                (78)         (117)

  Cash provided from (used by) financing activities

  Other short-term debt, net                          (270)           21
  Proceeds from issuance of other debt,
   net of issuance costs                               371            12
  Principal payments on other debt                     (7)           (13)
  Other, including book overdrafts                      21           (17)

  Net cash provided from financing activities          115             3

  Effect of exchange rate changes on cash               11            (7)

  Net increase in cash and equivalents                  16            57

  Cash and equivalents at beginning of year            865           752

  Cash and equivalents at end of period               $881          $809

                   VISTEON CORPORATION AND SUBSIDIARIES
              RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
                          (Dollars in Millions)
                               (Unaudited)

In this press release the Company has provided information regarding certain non-GAAP financial measures including "EBIT-R" and "free cash flow." Such non-GAAP financial measures are reconciled to their closest US GAAP financial measure in the schedules below.

EBIT-R: EBIT-R represents net income (loss) before net interest expense and provision for income taxes and excludes impairment and net unreimbursed restructuring charges. Management believes EBIT-R is useful to investors because the excluded items may vary significantly in timing or amounts and/or may obscure trends useful in evaluating and comparing the Company's continuing operating activities.

                                       Three-Months Ended       2006
                                            March 31          Estimate

                                      2006         2005

  Net income (loss)                    $3          $(163)   $(150)-$(120)
   Interest expense, net               39             29             160
   Provision for income taxes          30             22             110
   Net unreimbursed restructuring
    expense                             -              7               -
  EBIT-R                              $72          $(105)      $120-$150

EBIT-R is not a recognized term under GAAP and does not purport to be an alternative to net income (loss) as an indicator of operating performance or to cash flows from operating activities as a measure of liquidity. Because not all companies use identical calculations, this presentation of EBIT-R may not be comparable to other similarly titled measures of other companies. Additionally, EBIT-R is not intended to be a measure of free cash flow for management's discretionary use, as it does not consider certain cash requirements such as interest payments, tax payments and debt service requirements.

Free Cash Flow: Free cash flow represents cash flow from operating activities less capital expenditures. Management believes that free cash flow is useful in analyzing the Company's ability to service and repay its debt and it uses the measure for planning and forecasting future periods, as well as in compensation decisions.

                                          Three-Months Ended         2006
                                          March 31    December 31  Estimate
                                       2006     2005     2005

  Cash provided from operating
   activities                         $(32)     $178      $42        $500
    Capital expenditures               (85)     (127)    (185)       (450)
  Free cash flow                     $(117)      $51    $(143)        $50

Free cash flow is not a recognized term under GAAP and does not reflect cash used to service debt and does not reflect funds available for investment or other discretionary uses.