Ford Australia announces production changes

MELBOURNE, Australia (July 17, 2012): Ford Australia will reduce overall production numbers in the next 3.5 months to more closely align production with current market demand. Production will change from 209 vehicles per day to 148 vehicles per day in November 2012 in a direct response to changing customer preferences, which have driven a continued industry-wide decline in the sale of large vehicles. As a result, up to 440 redundancies will be offered across the business, primarily from the manufacturing operations. Redundancies will be offered on a voluntary basis in the first instance but a compulsory program may follow if the required reductions arent reached. Ford Australia President & CEO Bob Graziano said that, although difficult, the reductions are necessary in order to provide more stability and certainty for the business. We understand that, unfortunately, the impact on our employees will be significant, but implementing this structural change is essential to ensure the longer-term health of the business, which is important for our employees, our suppliers and the communities in which we operate. All employees who take up the redundancy will receive a competitive redundancy package, including training and career counselling; and we will work closely with them and our union partners to help our employees make the transition successfully. Although the quantum of vehicles will decrease, Ford will continue to manufacture a more profitable mix of vehicles to maximise returns in each segment. One key element of the production changes is to increase Territorys share of production to almost 50 per cent of total daily vehicles. This will allow the company to capitalise on its continued popularity and increasing SUV sales. In addition, the company will continue aggressively implementing the best of Fords global resources to improve the fuel efficiency of the vehicles produced and sold in Australia. Customer preferences are continuing to move rapidly towards more fuel efficient vehicles, which is why we have recently introduced Fords global EcoBoost technology to Falcon. This global technology has brought fuel efficiency improvements of up to 20% and reduced emissions by a similar amount. We believe this and other recently introduced technologies such as our EcoLPi system, will stabilise sales in this segment, said Graziano.

We have also recently announced a further $103 million investment across our locally produced vehicle lines, which will come to market in 2014, which demonstrates our on-going support for the large car segment in Australia. We are committed to the Ford brand and continuing to produce vehicles in Australia. ###

About Ford Motor Company Ford Motor Company, a global automotive industry leader based in Dearborn, Mich., manufactures or distributes automobiles across six continents. With about 166,000 employees and about 70 plants worldwide, the companys automotive brands include Ford and Lincoln. The company provides financial services through Ford Motor Credit Company. For more information regarding Fords products in Australia, please visit www.ford.com.au