<PAGE> 1
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
FORD MOTOR COMPANY
- -------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
FORD MOTOR COMPANY
- -------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing
fee is calculated and state how it was determined):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total fee paid:
- --------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
- --------------------------------------------------------------------------------
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
(1) Amount previously paid:
- --------------------------------------------------------------------------------
(2) Form, schedule or registration statement no.:
- --------------------------------------------------------------------------------
(3) Filing party:
- --------------------------------------------------------------------------------
(4) Date filed:
- --------------------------------------------------------------------------------
<PAGE> 2
[FORD LOGO]
Ford Motor Company The American Road
Dearborn, Michigan 48121-1899
April 16, 1999
TO OUR STOCKHOLDERS:
Our 1999 annual meeting of stockholders will be held at the Detroit Opera House,
1526 Broadway, Detroit, Michigan, on May 13, 1999.
The annual meeting will begin promptly at 10:00 a.m., eastern daylight saving
time. If you plan to attend the meeting, please see the instructions for
requesting an admission ticket on page 38.
Please read these materials so that you'll know what we plan to do at the
meeting. Also, please either sign and return the accompanying proxy card in the
postage-paid envelope or instruct us by telephone or via the Internet as to how
you would like your shares voted. This way, your shares will be voted as you
direct even if you can't attend the meeting. Instructions on how to vote your
shares by telephone or via the Internet are on the proxy card enclosed with this
proxy statement.
WILLIAM CLAY FORD, JR.
WILLIAM CLAY FORD, JR.
Chairman of the Board
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE PROVIDE
YOUR PROXY BY EITHER CALLING THE TOLL-FREE TELEPHONE NUMBER,
USING THE INTERNET, OR FILLING IN, SIGNING, DATING, AND PROMPTLY
MAILING THE ACCOMPANYING PROXY CARD IN THE ENCLOSED ENVELOPE.
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
<S> <C>
Notice of Annual Meeting of Stockholders.................... i
Defined Terms............................................... ii
Proxy Statement............................................. 1
Election of Directors....................................... 3
Committees of the Board of Directors........................ 7
Management Stock Ownership.................................. 9
Section 16(a) Beneficial Ownership Reporting Compliance..... 11
Compensation of Directors................................... 11
Certain Relationships and Related Transactions.............. 12
Compensation and Option Committee Report on Executive
Compensation (How Ford Determines Executive
Compensation)............................................. 13
Compensation of Executive Officers.......................... 18
Stock Options............................................... 20
Performance Stock Rights and Restricted Stock Units......... 21
Stock Performance Graphs.................................... 24
Retirement Plans............................................ 26
Proposals Requiring Your Vote............................... 27
Stockholder Proposals for 2000.............................. 37
Annual Report and Other Matters............................. 37
Expenses of Solicitation.................................... 37
How to Attend the Annual Meeting............................ 38
Directions to the Annual Meeting Site....................... 38
</TABLE>
<PAGE> 4
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
The annual meeting of stockholders of Ford Motor Company will be held at the
Detroit Opera House, 1526 Broadway, Detroit, Michigan, on Thursday, May 13,
1999, at 10:00 a.m., eastern daylight saving time. The purpose of the meeting is
to vote on the following proposals:
PROPOSAL 1.The election of directors.
PROPOSAL 2.The approval of PricewaterhouseCoopers LLP as Ford's independent
public accountants for 1999.
PROPOSAL 3.A stockholder proposal relating to political non-partisanship.
PROPOSAL 4.A stockholder proposal relating to global warming.
PROPOSAL 5.A stockholder proposal relating to a proposed set of global corporate
standards.
PROPOSAL 6.A stockholder proposal relating to a proposed study to add Ford
employee(s) to the Board of Directors.
PROPOSAL 7.A stockholder proposal relating to independent directors on key board
committees.
The record date for the annual meeting is March 15, 1999. Only stockholders of
record at the close of business on that date can vote at the meeting.
JOHN M. RINTAMAKI
JOHN M. RINTAMAKI
Secretary
April 16, 1999
i
<PAGE> 5
DEFINED TERMS
"CLASS B STOCK" means Ford's Class B Stock.
"FORD" or "WE" or "COMPANY" means Ford Motor Company.
"CONTINGENT STOCK RIGHT" or "PERFORMANCE STOCK RIGHT" means, under the Long-Term
Incentive Plan, an award of the right to earn up to a certain number of shares
of common stock based on performance against specified goals created by the
Compensation Committee.
"DIVIDEND EQUIVALENT" means cash or shares of common stock (or common stock
units) equal in value to dividends that would have been paid on shares of common
stock.
"FINAL AWARD" means shares of common stock awarded by the Compensation Committee
under a Contingent Stock Right or Performance Stock Right.
"LONG-TERM INCENTIVE PLAN" means Ford's 1986, 1990 or 1998 Long-Term Incentive
Plan.
"NAMED EXECUTIVES" means the executives named in the Summary Compensation Table
on p. 18.
"RESTRICTED STOCK UNIT" or "UNIT" means the right to receive cash equal to the
then-current value of one share of common stock if specified goals set by the
Compensation Committee are met.
"SERIES B PREFERRED STOCK" means Ford's Series B Cumulative Preferred Stock.
"1998 PLAN" means Ford's 1998 Long-Term Incentive Plan.
ii
<PAGE> 6
PROXY STATEMENT
FORD MOTOR COMPANY April 16, 1999
THE AMERICAN ROAD
DEARBORN, MICHIGAN 48121-1899
The Board of Directors is soliciting proxies to be used at the 1999 annual
meeting. This proxy statement and the enclosed form of proxy will be mailed to
stockholders beginning April 16, 1999.
Definitions of capitalized terms in this Proxy Statement are on the facing page.
WHO CAN VOTE
Record holders of common stock and record holders of Class B Stock at the close
of business on March 15, 1999 may vote at the meeting. Holders of Series B
Preferred Stock cannot vote at this meeting.
On March 15, 1999, 1,140,260,233 shares of common stock and 70,852,076 shares of
Class B Stock were outstanding. Each stockholder has one vote for each share of
common stock and 10.729 votes for each share of Class B Stock.
Holders of common stock have 60% of the general voting power; holders of Class B
Stock have the remaining 40% of the general voting power. Holders of common
stock and holders of Class B Stock will vote together, without regard to class,
on the matters to be voted upon at the meeting.
HOW YOU CAN VOTE
Stockholders of record can give a proxy to be voted at the meeting either (i)
over the telephone by calling a toll-free number, (ii) electronically, using the
Internet, or (iii) by mailing in the enclosed proxy card. Stockholders who hold
their shares in "street name" must vote their shares in the manner prescribed by
their brokers.
The telephone and Internet voting procedures have been set up for your
convenience and have been designed to authenticate your identity, to allow you
to give voting instructions, and to confirm that those instructions have been
recorded properly. If you are a stockholder of record and you would like to vote
by telephone or by using the Internet, please refer to the specific instructions
set forth on the enclosed proxy card. If you wish to vote using a paper format
and you return your signed proxy to us before the annual meeting, we will vote
your shares as you direct.
Whether you choose to vote by telephone, over the Internet or by mail, you can
specify whether your shares should be voted for all, some, or none of the
nominees for director (Proposal 1 on the proxy card). You can also specify
whether you approve, disapprove, or abstain from each of six additional
proposals. Proposals 1 and 2 will be presented at the meeting by management, and
the rest may be presented by stockholders. Proposal 1 for the election of
directors is described in this proxy statement beginning at p. 3 and the
remaining proposals are described beginning at p. 27.
IF YOU DO NOT SPECIFY ON YOUR PROXY CARD (OR WHEN GIVING YOUR PROXY BY TELEPHONE
OR OVER THE INTERNET) HOW YOU WANT TO VOTE YOUR SHARES, WE WILL VOTE THEM "FOR"
THE ELECTION OF ALL NOMINEES FOR DIRECTOR AS SET FORTH UNDER "ELECTION OF
DIRECTORS" (PROPOSAL 1) BELOW; "FOR" PROPOSAL 2; AND "AGAINST" PROPOSALS 3
THROUGH 7.
1
<PAGE> 7
REVOCATION OF PROXIES
You can revoke your proxy at any time before it is exercised in any of three
ways:
(1) by submitting written notice of revocation to the Secretary;
(2) by submitting another proxy by telephone, via the Internet or by mail
that is later dated and, if by mail, that is properly signed; or
(3) by voting in person at the meeting.
REQUIRED VOTES
A majority of the votes that could be cast by stockholders who are either
present in person or represented by proxy at the meeting is required to elect
the nominees for director and to approve each proposal. The votes are computed
for each share as described on p. 1.
The total number of votes that could be cast at the meeting is the number of
votes actually cast plus the number of abstentions. Abstentions are counted as
"shares present" at the meeting for purposes of determining whether a quorum
exists and have the effect of a vote "against" any matter as to which they are
specified. Proxies submitted by brokers that do not indicate a vote for some or
all of the proposals because they don't have discretionary voting authority and
haven't received instructions as to how to vote on those proposals (so-called
"broker nonvotes") are not considered "shares present" and will not affect the
outcome of the vote.
OTHER MATTERS TO BE ACTED UPON AT THE MEETING
We do not know of any other matters to be presented or acted upon at the
meeting. Under our By-Laws, no business besides that stated in the meeting
notice may be transacted at any meeting of stockholders. If any other matter is
presented at the meeting on which a vote may properly be taken, the shares
represented by proxies will be voted in accordance with the judgment of the
person or persons voting those shares.
2
<PAGE> 8
ELECTION OF DIRECTORS
(PROPOSAL 1 ON THE PROXY CARD)
Eleven directors will be elected at this year's annual meeting. Each director
will serve until the next annual meeting or until he or she is succeeded by
another qualified director who has been elected.
We will vote your shares as you specify when providing your proxy. If you do not
specify how you want your shares voted when you provide your proxy, we will vote
them for the election of all the nominees listed below. If unforeseen
circumstances (such as death or disability) make it necessary for the Board of
Directors to substitute another person for any of the nominees, we will vote
your shares for that other person.
Each of the nominees for director is now a member of the Board of Directors,
which met eleven times during 1998. All of the nominees for director attended
more than 75% of the combined Board of Director and committee meetings in 1998,
except William Clay Ford who missed certain meetings due to illness. The
following information about the nominees was provided by the nominees.
NOMINEES
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
MICHAEL D. DINGMAN PHOTO
Age: 67
Director Since: 1981
Principal Occupation: President and CEO, Shipston Group Ltd., Nassau,
Bahamas
Recent Business Experience: Mr. Dingman is the President and CEO of Shipston
Group Ltd., a diversified international holding
company. In addition, he is the former Chairman of
the Board and a current director of Fisher
Scientific International, a leader in serving
science and providing products and services to
research, health care, industry, education, and
governments worldwide.
Other Directorships: Teekay Shipping Corporation
- -----------------------------------------------------------------------------------------------------------
EDSEL B. FORD II PHOTO
Age: 50
Director Since: 1988
Principal Occupation: Former Vice President, Ford Motor Company and
Former Chief Operating Officer, Ford Motor Credit
Company
Recent Business Experience: Mr. Ford retired as President and Chief Operating
Officer of Ford Motor Credit Company in 1998 having
served in that capacity since May 1991. Mr. Ford
was also a Vice President of the Company from 1993
through the end of 1998. Prior to 1991, he held
numerous senior executive positions at Ford and
Lincoln-Mercury, both domestic and abroad.
Other Directorships: Penske Motorsports, Inc.
- -----------------------------------------------------------------------------------------------------------
</TABLE>
3
<PAGE> 9
<TABLE>
<S> <C> <C>
- -----------------------------------------------------------------------------------------------------------
WILLIAM CLAY FORD PHOTO
Age: 74
Director Since: 1948
Principal Occupation: Retired Chairman of the Finance Committee, Ford
Motor Company
Recent Business Experience: Mr. Ford served as Chairman of the Finance
Committee of Ford's Board of Directors from
November 1987 to January 1995. He was elected a
Vice Chairman of Ford in 1980, retiring from that
position in 1989. He also owns and is President of
The Detroit Lions, Inc.
- -----------------------------------------------------------------------------------------------------------
WILLIAM CLAY FORD, JR. PHOTO
Age: 41
Director Since: 1988
Principal Occupation: Mr. Ford was elected Chairman of the Board of
Directors of the Company effective January 1, 1999.
Mr. Ford also serves as Chairman of the
Environmental and Public Policy Committee, Chairman
of the Finance Committee and Chairman of the
Organization Review and Nominating Committee.
Recent Business Experience: Mr. Ford has held a number of management positions
within Ford, including Vice President -- Commercial
Truck Vehicle Center, until January 1, 1995, when
he became Chairman of the Finance Committee of the
Board of Directors of the Company. Mr. Ford also is
Vice Chairman of The Detroit Lions, Inc., and
Chairman of the Board of Trustees of the Henry Ford
Museum and Greenfield Village.
- -----------------------------------------------------------------------------------------------------------
IRVINE O. HOCKADAY, JR. PHOTO
Age: 62
Director Since: 1987
Principal Occupation: President and CEO, Hallmark Cards, Inc., Kansas
City, Missouri
Recent Business Experience: Mr. Hockaday has been President and CEO of Hallmark
Cards, Inc. since January 1, 1986, and a director
since 1978.
Other Directorships: Dow Jones, Inc.; Sprint Corporation; UtiliCorp
United, Inc.
- -----------------------------------------------------------------------------------------------------------
</TABLE>
4
<PAGE> 10
<TABLE>
<S> <C> <C>
- -----------------------------------------------------------------------------------------------------------
MARIE-JOSEE KRAVIS PHOTO
Age: 49
Director Since: 1995
Principal Occupation: Senior Fellow, Hudson Institute Inc., Indianapolis,
Indiana
Recent Business Experience: Mrs. Kravis was appointed a senior fellow of the
Hudson Institute Inc. in 1994. Prior to that time,
and since 1978, she served as Executive Director of
the Hudson Institute of Canada.
Other Directorships: Canadian Imperial Bank of Commerce; Hasbro Inc.; Hollinger
International Inc.; The Seagram Co. Ltd.; UniMedia Inc.
- -----------------------------------------------------------------------------------------------------------
ELLEN R. MARRAM PHOTO
Age: 52
Director Since: 1988
Principal Occupation: Former President and CEO, Tropicana Beverage Group,
New York, New York
Recent Business Experience: Ms. Marram served as President and CEO of Tropicana
Beverage Group from September 1997 until November
1998 and had previously served as President of the
Group since joining Seagram in 1993. She also
served as Executive Vice President of The Seagram
Company Ltd. and Joseph C. Seagram & Sons, Inc. She
served as President and CEO of Nabisco Biscuit
Company and Senior Vice President of the Nabisco
Foods Group from June 1988 until April 1993.
Other Directorships: The New York Times Company
- -----------------------------------------------------------------------------------------------------------
JACQUES A. NASSER PHOTO
Age: 51
Director Since: 1998
Principal Occupation: Mr. Nasser was elected President and Chief
Executive Officer of the Company effective January
1, 1999.
Recent Business Experience: Prior to his election as President and CEO of the
Company, Mr. Nasser was Executive Vice President,
President -- Ford Automotive Operations. Before
heading Ford Automotive Operations, Mr. Nasser was
Group Vice President -- Product Development from
1994-1996. He was elected a Company Vice President
in 1993 as the Chairman of Ford of Europe. From
1990 to 1993, Mr. Nasser served as President of
Ford of Australia. He has held a number of other
global positions in Asia-Pacific and South America
since joining the Company in 1968.
- -----------------------------------------------------------------------------------------------------------
</TABLE>
5
<PAGE> 11
<TABLE>
<S> <C> <C>
- -----------------------------------------------------------------------------------------------------------
HOMER A. NEAL PHOTO
Age: 56
Director Since: 1997
Principal Occupation: Director, ATLAS Project, Professor of Physics, and
Interim President Emeritus, The University of
Michigan, Ann Arbor, Michigan
Recent Business Experience: Dr. Neal is the Director of the ATLAS Project,
Professor of Physics, and Interim President
Emeritus at the University of Michigan. He served
as Interim President of the University of Michigan
from July 1, 1996 to February 1, 1997. From 1987 to
1993, Dr. Neal was Chair of the University of
Michigan's Physics Department and from 1993 to 1997
he served as Vice President of Research for the
University of Michigan.
Other Directorships: Ogden Corporation; Center for Strategic and
International Studies; Smithsonian Institution
- -----------------------------------------------------------------------------------------------------------
CARL E. REICHARDT PHOTO
Age: 67
Director Since: 1986
Principal Occupation: Retired Chairman and CEO, Wells Fargo & Company,
San Francisco, California
Recent Business Experience: Mr. Reichardt served as Chairman and CEO of Wells
Fargo & Company from 1983 until his retirement on
December 31, 1994.
Other Directorships: Columbia/HCA Healthcare Corporation; ConAgra, Inc.;
McKesson HBOC, Inc.; Newhall Management
Corporation; Pacific Gas and Electric Company; PG&E
Corporation
- -----------------------------------------------------------------------------------------------------------
JOHN L. THORNTON PHOTO
Age: 45
Director Since: 1996
Principal Occupation: President and Co-Chief Operating Officer, Goldman
Sachs Group, L.P.
Recent Business Experience: Mr. Thornton formerly served as Chairman of Goldman
Sachs -- Asia. He was previously co-chief executive
of Goldman Sachs International, the firm's business
in Europe, the Middle East and Africa. Mr. Thornton
joined Goldman Sachs in 1980 and was named a
partner in 1988.
Other Directorships: British Sky Broadcasting Group PLC; Goldman Sachs
Group, Inc.; Laura Ashley PLC; Pacific Century
Group
- -----------------------------------------------------------------------------------------------------------
</TABLE>
6
<PAGE> 12
COMMITTEES OF THE BOARD OF DIRECTORS
AUDIT COMMITTEE
Number of Members: 4
Members: Irvine O. Hockaday, Jr. (Chairman)
Ellen R. Marram
Homer A. Neal
John L. Thornton
Number of Meetings in 1998: 4
Functions: Selects independent public accountants to audit
Ford's books and records, subject to stockholder
approval.
Consults with these accountants and reviews and
approves the scope of their audit.
Reviews internal controls, accounting practices,
financial
structure, and financial reporting.
Reports to the Board of Directors about these
matters.
COMPENSATION AND OPTION COMMITTEE
Number of Members: 2
Members: Michael D. Dingman (Chairman)
Carl E. Reichardt
Number of Meetings in 1998: 7
Functions: Establishes the salaries and determines any bonus
awards for Ford's executive officers.
Considers and makes recommendations on Ford's
executive compensation plans.
Makes recommendations on grants of stock options
and makes grants of Performance Stock Rights and
Restricted Stock Units.
ENVIRONMENTAL AND PUBLIC POLICY COMMITTEE
Number of Members: 3
Members: William Clay Ford, Jr. (Chairman)
Ellen R. Marram
Homer A. Neal
Number of Meetings in 1998: 2
Functions: Reviews environmental and public policy issues
facing the Company around the world. Reports to
the Board of Directors about these matters.
7
<PAGE> 13
FINANCE COMMITTEE
Number of Members: 7
Members: William Clay Ford, Jr. (Chairman)
Michael D. Dingman
Edsel B. Ford II
William Clay Ford
Marie-Josee Kravis
Jacques A. Nasser
Carl E. Reichardt
Number of Meetings in 1998: 5
Functions: Between meetings of the Board of Directors,
exercises all Board powers concerning Ford's
financial policies and financial management
(except matters within the powers of the Audit
Committee or the Compensation and Option
Committee).
ORGANIZATION REVIEW AND NOMINATING COMMITTEE
Number of Members: 11
Members: William Clay Ford, Jr. (Chairman)
Michael D. Dingman
Edsel B. Ford II
William Clay Ford
Irvine O. Hockaday, Jr.
Marie-Josee Kravis
Ellen R. Marram
Jacques A. Nasser
Homer A. Neal
Carl E. Reichardt
John L. Thornton
Number of Meetings in 1998: 7
Functions: Makes recommendations on:
- Ford's management organization;
- the nominations or elections of directors and
officers;
- the size and composition of the Board; and
- the appointments of other Company employees
referred to the Committee.
Considers stockholder suggestions for nominees
for director (other than self-nominations).
Suggestions should be submitted to the Secretary
of the Company, The American Road, Dearborn,
Michigan 48121. Suggestions received by the
Secretary's office before December 31 will be
considered by the Committee at a regular meeting
in the following year, before the proxy materials
are mailed to stockholders.
8
<PAGE> 14
MANAGEMENT STOCK OWNERSHIP
The table below shows how much stock of Ford and of its majority-owned
subsidiary, The Hertz Corporation ("Hertz"), each director, nominee, and Named
Executive beneficially owned as of March 1, 1999. No director, nominee, or Named
Executive beneficially owned any Ford preferred stock. No director, nominee or
executive officer, including Named Executives, beneficially owned more than 0.2%
of Ford's total outstanding common stock or of Hertz's total outstanding Class A
Common Stock. Directors and executive officers as a group, including the Named
Executives, beneficially owned 0.4% of Ford common stock and 0.1% of Hertz's
Class A Common Stock. In addition, these persons held options exercisable on or
within 60 days after March 1, 1999 to buy 6,686,825 shares of Ford common stock
under stock option plans.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------
Percent of
Ford Outstanding Hertz
Ford Common Ford Ford Class A
Common Stock Class B Class B Common
Name Stock(1)(2) Units(3) Stock(4) Stock Stock
<S> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------
W. Wayne Booker 183,275 0 0 0 0
- ------------------------------------------------------------------------------------------------------------
Michael D. Dingman* 18,539 81,040 0 0 0
- ------------------------------------------------------------------------------------------------------------
Edsel B. Ford II* 219,837 0 5,634,801 7.95 0
- ------------------------------------------------------------------------------------------------------------
William Clay Ford* 1,955,114 1,066 15,142,510 21.37 0
- ------------------------------------------------------------------------------------------------------------
William Clay Ford, Jr.* 144,103 1,066 3,301,713 4.67 0
- ------------------------------------------------------------------------------------------------------------
Edward E. Hagenlocker 53,929 0 0 0 2,000
- ------------------------------------------------------------------------------------------------------------
Irvine O. Hockaday, Jr.* 8,515 8,105 0 0 0
- ------------------------------------------------------------------------------------------------------------
Marie-Josee Kravis* 4,600 5,734 0 0 0
- ------------------------------------------------------------------------------------------------------------
Ellen R. Marram* 7,610 12,497 0 0 0
- ------------------------------------------------------------------------------------------------------------
Jacques A. Nasser* 82,685 0 0 0 10,000
- ------------------------------------------------------------------------------------------------------------
Homer A. Neal* 2,500 578 0 0 0
- ------------------------------------------------------------------------------------------------------------
Carl E. Reichardt* 20,000 1,066 0 0 0
- ------------------------------------------------------------------------------------------------------------
John L. Thornton(5)* 12,980 6,067 0 0 0
- ------------------------------------------------------------------------------------------------------------
Alex Trotman 191,340 0 0 0 30,000
- ------------------------------------------------------------------------------------------------------------
Kenneth Whipple 273,309 0 0 0 0
- ------------------------------------------------------------------------------------------------------------
All Directors and Executive Officers as a
group (59 persons) 4,784,802 117,219 24,079,024 33.99 58,190
- ------------------------------------------------------------------------------------------------------------
</TABLE>
* Indicates Directors
9
<PAGE> 15
NOTES
(1)Includes restricted shares of common stock issued under the Restricted Stock
Plan for Nonemployee Directors, as follows: 1,600 shares for Homer A. Neal; 800
shares each for William Clay Ford, Jr. and Marie-Josee Kravis; 400 shares each
for the other eligible nonemployee directors, except John L. Thornton, for whom
the number includes 1,725 restricted common stock equivalents under that plan.
For nominees who are or were Ford employees, this includes shares of common
stock represented by Ford Stock Fund Units credited under a deferred
compensation plan. These shares may be delivered after termination of
employment.
(2)Michael D. Dingman has reported and disclaimed beneficial ownership of 1,782
shares of common stock owned by members of his immediate family.
Present directors and executive officers as a group have reported and disclaimed
beneficial ownership of a total of 2,554 shares of common stock.
Also, on March 1, 1999 (or within 60 days after that date), nominees who are or
were Ford employees and the Named Executives have rights to acquire shares of
common stock through the exercise of stock options under Ford's stock option
plans as follows:
<TABLE>
<CAPTION>
Person Number of Shares
------ ----------------
<S> <C>
W. Wayne Booker............................................. 399,760
Edsel B. Ford II............................................ 61,543
Edward E. Hagenlocker....................................... 184,423
Jacques A. Nasser........................................... 641,705
Alex Trotman................................................ 392,574
Kenneth Whipple............................................. 489,262
</TABLE>
(3)These are common stock units credited under a deferred compensation plan.
(4)As of March 1, 1999, the following persons owned more than 5% of the
outstanding Class B Stock: Josephine F. Ford, c/o Ford Estates, Dearborn,
Michigan, beneficially owned 14,391,055 shares (20.31%); and Lynn F. Alandt, c/o
Ford Estates, Dearborn, Michigan, beneficially owned 8,319,574 shares (11.74%).
Of the outstanding Class B Stock, 47,002,918 shares are held in a voting trust
of which Edsel B. Ford II, William Clay Ford, and William Clay Ford, Jr. are
among the trustees. The trust requires the trustees to vote the shares as
directed by a plurality of the shares in the trust. Edsel B. Ford II is a nephew
and William Clay Ford, Jr. is the son of William Clay Ford.
(5)Shares reported as beneficially owned by John L. Thornton do not include
securities held by Goldman, Sachs & Co. in the ordinary course of business.
IMPACT RESULTING FROM SPIN-OFF OF ASSOCIATES FIRST CAPITAL CORPORATION STOCK
To account for the change in the value of the Company's common stock resulting
from the spin-off of the Company's interest in Associates First Capital
Corporation on April 7, 1998, the following items held by officers or directors
of the Company as of April 9, 1998 were adjusted to ensure that the aggregate
value of the item before and after the spin-off would be approximately equal:
common stock units, contingent stock rights, deferred contingent credits,
performance stock rights, restricted common stock equivalents, restricted stock
units, and stock options. References in this proxy statement to any of these
items that were issued prior to April 9, 1998 are to the adjusted amounts.
10
<PAGE> 16
SECTION 16(A)
BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based on Company records and other information, Ford believes that all SEC
filing requirements applicable to its directors and officers were complied with
for 1998 and prior years except that, due to a clerical oversight by the
Company, Alex Trotman had one late report of three transactions, and Peter J.
Pestillo and William A. Swift each had one late report of one transaction. Each
of these transactions was exempt under Section 16(b) of the Securities Exchange
Act of 1934, as amended.
COMPENSATION OF DIRECTORS
GOAL. Ford wants the directors' compensation to be tied to your interests as
stockholders. Accordingly, 25% ($10,000) of a director's annual Board membership
fee is deferred in the form of common stock units. This deferral, together with
the restricted stock given to directors and director stock ownership goals, is
part of Ford's commitment to link director and stockholder interests. These
compensation programs are described below.
FEES. The following fees are paid to directors, other than the Chairman of the
Board, who are not Ford employees:
<TABLE>
<S> <C>
Annual Board membership fee................................. $40,000
Annual Committee membership fee............................. $10,000
Attendance fee for each Board meeting....................... $ 1,000
</TABLE>
The Chairman of the Board is paid a Chairman fee for each calendar quarter of
$375,000, paid in restricted shares of common stock. These shares cannot be sold
for one year and are subject to the conditions of the 1998 Long-Term Incentive
Plan.
DEFERRED COMPENSATION PLAN. Under this plan, 25% of a director's annual Board
membership fee must be deferred in common stock units. Directors also can choose
to have the payment of all or some of the remainder of their fees deferred in
the form of cash and/or common stock units. Each common stock unit is equal in
value to a share of common stock and is ultimately paid in cash. These common
stock units generate Dividend Equivalents in the form of additional common stock
units. These units are credited to the directors' accounts on the date common
stock cash dividends are paid. Any fees deferred in cash are held in the general
funds of the Company. Interest on fees deferred in cash is credited semiannually
to the directors' accounts at the then-current U.S. Treasury Bill rate plus
0.75%. In general, deferred amounts are not paid until after the director
retires from the Board. The amounts are then paid, at the director's option,
either in a lump sum or in annual installments over a period of up to ten years.
RESTRICTED STOCK PLAN. Nonemployee directors also receive restricted shares of
common stock. Each nonemployee director who has served for at least six months
receives 2,000 shares of common stock subject to restrictions on sale. In
general, the restrictions expire for 20% of the shares each year following the
year of the grant. Each nonemployee director receives an additional 2,000 shares
on the same terms when the restrictions on all of the prior 2,000 shares end.
STOCK OWNERSHIP GOALS. To further link director and stockholder interests, Ford
established stock ownership goals for nonemployee directors in 1995. Each
nonemployee director has a goal to own common stock equal in value to five times
the sum of the director's annual Board and Committee fees within five years.
11
<PAGE> 17
LIFE INSURANCE. Ford provides nonemployee directors with $200,000 of life
insurance and $500,000 of accidental death or dismemberment coverage. The life
insurance coverage continues after the director retires from the Board if the
director is at least age 55 and has served for at least five years. A director
who retires from the Board after age 70, or, with Board approval, after age 55,
and who has served for at least five years may elect to have the life insurance
reduced to $100,000 and receive $15,000 a year for life. The accidental death or
dismemberment coverage may, at the director's expense, be supplemented up to an
additional $500,000 and ends when the director retires from the Board.
MATCHING GIFT PROGRAM. Nonemployee directors may give up to $25,000 per year to
certain tax-exempt organizations under the Ford Fund Matching Gift Program. For
each dollar given, the Ford Motor Company Fund contributes two dollars.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Since January 1993, Ford has had a consulting agreement with William Clay Ford.
Under this agreement, Mr. Ford is available for consultation, representation,
and other duties (including service as a director). For these services, Ford
pays him $100,000 per year and provides facilities (including office space), an
administrative assistant, and security arrangements. This agreement will
continue until either party ends it with 30 days' notice.
Since January 1999, Ford has had a similar consulting agreement with Edsel B.
Ford II. Under this agreement, the consulting fee is $125,000 per calendar
quarter, payable in restricted shares of common stock. The shares cannot be sold
for one year and are subject to the conditions of the 1998 Long-Term Incentive
Plan. The other terms of the agreement are substantially similar to those
described in the paragraph above.
Mrs. Lynn Ford Alandt's husband owns a Ford-franchised dealership and a Lincoln
Mercury-franchised dealership. In 1998, the dealerships paid Ford about $74.2
million for products and services in the ordinary course of business. In turn,
Ford paid the dealerships about $9.1 million for services in the ordinary course
of business. Also in 1998, Ford Motor Credit Company, a wholly-owned subsidiary
of Ford, provided about $82.4 million of financing to the dealerships and paid
about $7.5 million to them in the ordinary course of business. The dealerships
paid Ford Credit about $74.6 million in the ordinary course of business.
John L. Thornton is a partner of Goldman, Sachs & Co. Goldman, Sachs has
provided Ford with investment banking services for many years. Ford expects
Goldman, Sachs to continue providing similar services in the future.
12
<PAGE> 18
COMPENSATION AND OPTION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
(HOW FORD DETERMINES EXECUTIVE COMPENSATION)
PURPOSES
Ford's executive compensation program aims to:
- Link managers' goals with your interests as stockholders.
- Support business plans and long-term Company goals.
- Tie executive compensation to Company performance.
- Attract and retain talented management.
TYPES OF COMPENSATION
There are two main types of compensation:
(1) Annual compensation. This includes salary and bonus. Ford awards
bonuses only when a year's profits and other performance criteria meet
a certain level required under the bonus plan.
(2) Long-term compensation. This includes stock options and other long-term
incentive awards based on common stock. The value of these awards
depends on Company performance and future stock value.
FACTORS CONSIDERED IN DETERMINING COMPENSATION
The Compensation Committee wants the compensation of Ford executives to be
competitive in the worldwide auto industry and with major U.S. companies. Each
year, the Committee reviews a report from an outside consultant on Ford's
compensation program for executives. The report discusses all aspects of
compensation as well as how Ford's program compares with those of other large
companies. Based on this report, its own review of various parts of the program,
and its assessment of the skills, experience, and achievements of individual
executives, the Committee decides the compensation of executives.
The consultant develops compensation data using a survey of several leading
companies picked by the consultant and Ford. General Motors and the former
Chrysler Corporation were included in the survey. Eighteen leading companies in
other industries also were included because the job market for executives goes
beyond the auto industry. Companies were picked based on size, reputation, and
business complexity.
The Committee looks at the size and success of the companies and the types of
jobs covered by the survey in determining executive compensation. One goal of
Ford's compensation program is to approximate the survey group's average
compensation, adjusted for company size and performance. In 1998, Ford's
executive salaries and long-term incentive awards generally were at this
average. Data on bonuses for the surveyed companies are not yet available, but
the Committee expects Ford's 1998 bonuses to be above the average of the survey
group.
The Committee also considers the tax deductibility of compensation paid to the
Named Executives. In 1998, you approved the terms of the new Annual Incentive
Compensation Plan and the new 1998 Long-Term Incentive Plan so that certain
compensation paid to these individuals would be deductible by the Company under
federal tax law. In 1995, you approved the terms of the 1990 Long-Term Incentive
Plan for the same reason. These plans limit the amount of bonuses, stock awards
and stock options that may be granted to any person in any year.
13
<PAGE> 19
Further, in 1994, the Committee created stock ownership goals for executives at
the vice president level and above. The goals are for these executives to own
common stock worth a multiple of salary, ranging from one times salary to up to
five times salary for the CEO, within five years. The CEO and most other key
managers have achieved their stock ownership goals.
ANNUAL COMPENSATION
GENERAL
Annual compensation for Ford executives includes salary and bonus. This is
similar to the compensation programs of most leading companies.
The Committee aims to pay salaries at the average of the survey companies,
adjusted for company size and performance. The Committee also looks at the
specific job duties, the person's achievements, and other criteria.
BONUSES
The Annual Incentive Compensation Plan provides for annual cash awards to
participants based on achievement of specific performance goals relating to a
specific year.
For 1998, the Committee set a bonus formula using performance goals based on
corporate pre-tax income, automotive after-tax return on sales, Ford Motor
Credit Company return on equity and quality (based on warranty performance and
customer satisfaction). Awards may be less than or greater than 100% of the
target award. The limit, approved by you, on the amount of a bonus award for any
of the Named Executives for any year under the plan is $10,000,000. This limit
is not a target. The Committee, in its discretion, may make awards to Named
Executives that are less than the annual limit. Mr. Trotman's bonus for 1998 was
$10,000,000. All other 1998 bonuses to Named Executives were below the limit.
The Committee also set target awards for the Company officers based on each
person's level of responsibility. Using business data, the Committee reviewed
Ford's performance during 1998 against the goals. The Committee decided that
Ford exceeded the corporate pre-tax income goal, exceeded the automotive
after-tax return on sales goal, partially achieved the Ford Motor Credit Company
return on equity goal and achieved the quality goal. Based on this performance,
the Committee decided to award 157% of the target awards to the officers and
then make adjustments for individual performance for awards to officers who are
not Named Executives.
The total amount set aside for bonuses in a given year depends on Ford's
performance during the year against the performance goals. For 1998, the
Committee set aside $483 million. Individual awards depend on each person's
level of responsibility. For persons other than the Named Executives, the
Committee increases or decreases awards from a formula amount, based on rank and
salary, to reward a person's or group's performance.
LONG-TERM COMPENSATION
GENERAL
Today's business decisions affect Ford over a number of years. This is why the
long-term incentive awards are tied to Ford's performance and the value of
Ford's common stock over several years.
In general, the amount of the long-term incentive awards does not change as much
as the amount of the annual bonus awards.
14
<PAGE> 20
The charts on pp. 24 and 25 show the long-term performance of Ford's common
stock.
STOCK OPTIONS
Stock options are an important part of Ford's long-term incentive program. The
managers who get them gain only when you gain -- when the common stock value
goes up.
In 1996, 1997 and 1998, the Named Executives and other employees received
ten-year options in amounts generally similar to prior years. In deciding the
size of individual option grants for 1998, the Committee considered the number
of options granted to the person in prior years, as well as the total number of
options awarded to all employees. A formula approved by you limits the number of
options that may be granted to any Named Executive. This limit, which is not a
target, is 2.5% of the highest number of shares available in any year for grants
under the 1998 Long-Term Incentive Plan, as adjusted under the Plan. All 1998
stock option grants to the Named Executives were below this limit.
STOCK AWARDS
Common stock awards are based on performance against goals created by the
Committee over a period of years.
In 1998, the Committee granted Performance Stock Rights to Company officers and
certain other top executives. These Performance Stock Rights cover the
performance period 1998-2000. Up to 150% of these rights may be awarded in the
form of common stock after this period ends. The awards are made if goals
relating to total shareholder returns relative to the stocks of all other
Standard & Poor's 500 companies are met.
The size of a person's Performance Stock Right award depends on competitive
long-term compensation values determined by the outside consultant, the person's
job, and the person's expected role in Ford's long-term performance. In general,
the Committee grants less than the maximum number of shares covered by the
Performance Stock Right award if the goals are only partly met.
The 1998 Long-Term Incentive Plan sets a limit, approved by you, on the number
of shares available as stock awards under Performance Stock Rights to any Named
Executive in any year. This limit is 500,000 shares, as adjusted under the Plan.
The Performance Stock Rights granted in 1998 for the Named Executives are below
the limit. For the 1998-2000 period, the Committee decided to pay Dividend
Equivalents in cash on the Performance Stock Rights granted in 1998.
The Final Awards of common stock in 1998 under the 1990 Long-Term Incentive Plan
covered the performance periods 1993-1997 and 1995-1997. Under that plan, up to
100% of the Contingent Stock Rights awarded may be granted in the form of common
stock after the period ends. Using business data, the Committee reviewed Ford's
performance during the 1993-1997 period against goals for product programs
(25%), cost reduction (25%), product quality and customer acceptance worldwide
(35%), and relationships with employees (15%). The Committee decided that Ford
partly achieved the product program and product quality goals, met the cost
reduction goals, mostly met the customer acceptance goals, and met the employee
relationships goals. Based on this performance, the Committee decided to award
83% of the shares covered by the Contingent Stock Rights and then make
adjustments for individual performance.
Using business data, the Committee also reviewed Ford's performance during the
1995-1997 period against goals for corporate return on equity (25%), product
programs (25%), product quality and customer acceptance worldwide (35%), and
relationships with employees (15%). The Committee decided that Ford partly
achieved the return on equity, product program and product quality goals, mostly
met the customer acceptance goals, and met the employee relationships goals.
Based on this
15
<PAGE> 21
performance, the Committee decided to award 81% of the shares covered by the
Contingent Stock Rights and then make adjustments for individual performance.
For the Named Executives, the adjusted awards for 1993-1997 and 1995-1997 were
100% of the initial grants. The Final Awards for the period ending in 1998 will
be made in mid-1999 after Company performance data are available. These amounts
will appear in next year's proxy statement.
RESTRICTED STOCK UNITS
The Committee granted Restricted Stock Units to ten executives in 1998. Three of
the ten -- Messrs. Booker, Hagenlocker, and Nasser -- are Named Executives.
A Restricted Stock Unit is worth one share of common stock. Again, this ties the
executive's interests to your interests as stockholders. If the executive meets
certain goals decided by the Committee, Ford pays the executive cash for each
Restricted Stock Unit equal to the then-current value of a share of common
stock.
The Committee grants the Restricted Stock Units and decides the goals, the
restriction period, and the other terms of each Unit. The Committee also decides
the extent to which the goals have been met and the final number of Units to
award after the restriction period ends. During the restriction period, the
Units cannot be sold or otherwise disposed of, and they are subject to
conditions under the 1998 Long-Term Incentive Plan.
The grant of Restricted Stock Units depends on the achievement of several major
Ford goals:
- worldwide product excellence,
- low-cost producer,
- industry leadership in customer satisfaction,
- empowered people,
- nimble through process leadership,
- industry leadership in corporate citizenship, and
- worldwide growth.
The Committee also reviews each person's contribution to meeting these goals.
Restricted Stock Units generally may not be paid out until 18 months after
retirement and are subject to conditions under the 1998 Long-Term Incentive
Plan. Dividend Equivalents are paid in cash until the payout of the Units. The
Units have no voting rights.
SELECT RETIREMENT PLAN
To speed up the development of future leaders and reduce the number of top
manager jobs, the Committee supported making offers under the Select Retirement
Plan, a voluntary retirement program for certain U.S. management employees, in
1998. In general, the program added three years of age and contributory service
for retirement benefits purposes. To be eligible, employees generally had to be
at least age 52 with 10 or more years of service. The Committee reviewed and
approved Select Retirement Plan offers for certain executives. Some of the
executives retired during 1998 under this program. More information on the
program is on p. 27.
16
<PAGE> 22
CEO COMPENSATION
ANNUAL COMPENSATION
Mr. Trotman's salary, paid in 1998, as reported in the Summary Compensation
Table, reflects a 25% increase over the amount paid in 1997. Prior to 1998, the
Committee last increased his salary in 1996, the first increase since 1993. In
deciding to increase Mr. Trotman's salary, the Committee considered his job
duties as well as the pay practices of the survey companies.
Mr. Trotman's bonus for 1998 was based on Ford's performance, using the method
described above under "Bonuses." The Committee also considered other factors in
applying its "negative discretion" permitted under the Internal Revenue Code
(section 162(m)). It also considered his job as head of a restructured global
company with a wide area of control and broad duties. The Committee and other
nonemployee directors of Ford reviewed his 1998 accomplishments, and the
Committee considered these combined views. Mr. Trotman's bonus for 1998 was
below the formula limit in the bonus plan; however, it was capped at the
$10,000,000 plan limit.
LONG-TERM COMPENSATION
The Final Award of common stock in 1998 for Mr. Trotman was based on Ford's
performance from 1993 to 1997 and 1995 to 1997, using the method described above
under "Long-Term Compensation -- Stock Awards." (The amount of the Final Award
is shown in column (h) of the Summary Compensation Table on p. 18, under the
heading "LTIP Payouts.") The Committee adjusted the amount based on the factors
described above. The Final Award was in shares of common stock, a portion of
which Mr. Trotman elected to defer.
The value of the stock options and Performance Stock Rights granted to Mr.
Trotman in 1998 also depends on Ford's future success -- and whether that
success is reflected in the value of the common stock. For the Performance Stock
Rights, the value of any Final Award also depends on the level of achievement of
total shareholder return goals created by the Committee for 1998-2000.
In applying its "negative discretion" under the Internal Revenue Code in
deciding the number of stock options to grant Mr. Trotman (shown in column (b)
of the Options/SAR Grants Table on p. 20), the Committee considered the value of
his other long-term incentive compensation compared with competitive long-term
compensation values. It also considered the complexity and duties of his job.
Finally, the Committee considered the deductibility of Mr. Trotman's
compensation under the tax laws. As discussed above, you approved plan
amendments and new plans allowing Ford to deduct, for federal income tax
purposes, certain parts of Mr. Trotman's compensation (as well as that of other
Named Executives) for tax years starting with 1995.
Compensation and Option Committee
Michael D. Dingman, Chairman
Carl E. Reichardt
17
<PAGE> 23
COMPENSATION OF EXECUTIVE OFFICERS
The table below shows the before-tax compensation for the last three years for
Alex Trotman, who served as CEO in 1998, and the four next highest paid
executive officers at the end of 1998.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
Annual Compensation Long-Term Compensation
Awards Payouts
- ---------------------------------------------------------------------------------------------------------------------------------
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Securities
Other Restricted Underlying
Annual Stock Options/ LTIP All Other
Compensation Award(s) SARs Payouts Compensation
Name and Principal Position Year Salary($) Bonus($) ($) ($)(1) (#)(2) ($)(3) ($)(4)
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Alex Trotman(5) 1998 2,500,000 10,000,000 2,219,282 -- 431,400 -- 149,998
Chairman, President and 1997 2,000,000 7,000,000 940,135 630,754 431,400 24,137,034 119,996
CEO 1996 1,916,667 2,500,000 502,884 704,429 431,400 9,793,875 114,996
- ---------------------------------------------------------------------------------------------------------------------------------
W. Wayne Booker(6) 1998 714,166 3,100,000 416,356 -- 107,850 -- 42,845
Vice Chairman 1997 677,917 2,300,000 354,135 -- 107,850 7,692,401 40,675
1996 650,000 950,000 303,070 -- 107,850 1,751,750 39,000
- ---------------------------------------------------------------------------------------------------------------------------------
Edward E. Hagenlocker(7) 1998 840,000 3,100,000 558,495 -- 179,750 -- 50,400
Vice Chairman 1997 803,333 2,600,000 428,860 21,126 215,700 9,641,119 48,196
1996 758,333 1,050,000 347,730 20,332 215,700 2,030,438 45,499
- ---------------------------------------------------------------------------------------------------------------------------------
Jacques A. Nasser(8) 1998 1,050,000 5,000,000 773,369 -- 915,700 -- 63,000
Executive Vice President 1997 716,664 3,000,000 362,871 -- 215,700 6,051,332 42,998
and President, Ford 1996 591,667 950,000 231,196 -- 122,230 1,035,125 35,500
Automotive Operations
- ---------------------------------------------------------------------------------------------------------------------------------
Kenneth Whipple(9) 1998 710,000 3,100,000 323,058 -- 107,850 -- 42,596
Executive Vice President; 1997 677,917 2,300,000 378,145 -- 107,850 9,401,824 40,675
President, Ford Financial 1996 647,500 950,000 321,700 86,904 107,850 4,737,688 38,850
Services Group; and
Chairman and CEO, Ford
Motor Credit Company
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTES
(1)Amounts shown as Restricted Stock Awards for 1997 and 1996 represent Dividend
Equivalents paid in restricted stock under the Long-Term Incentive Plans.
Restrictions on this stock generally lapsed in 1998. Holders of restricted stock
received the same cash dividends as other stockholders owning common stock.
Listed below are the total number of shares represented by Ford Stock Fund Units
credited to the Named Executives under a deferred compensation plan and the
market values of these shares (determined by the closing price of common stock
on the New York Stock Exchange on December 31, 1998). These shares will be
distributed after termination of employment.
<TABLE>
<CAPTION>
Named Executive Number of Shares Market Value
--------------- ---------------- ------------
<S> <C> <C>
W. Wayne Booker....................................... 101,764 $5,972,569
Edward E. Hagenlocker................................. 944 $ 55,430
</TABLE>
18
<PAGE> 24
The ultimate worth of the restricted stock depends on the value of common stock
when the restrictions lapse. Under the Long-Term Incentive Plans generally, the
Compensation Committee determines any restriction period for shares included in
each Final Award. For each of the Named Executives, restrictions ended on
January 1, 1998 on up to 18,000 shares awarded for the 1991-95 performance
period. Restrictions ended on February 13, 1998 on all remaining shares of
restricted stock held by the Named Executives.
(2)In general, under the 1985 Stock Option Plan, the 1990 Long-Term Incentive
Plan and the 1998 Long-Term Incentive Plan, stock appreciation rights may be
granted along with the grant of options to executive officers. Exercise of a
stock appreciation right cancels the related stock option, and vice versa.
(3)These amounts represent Final Awards under the Long-Term Incentive Plans. The
Final Awards for the performance periods ending in 1996 were in restricted stock
and the Final Awards for the performance periods ending in 1997 generally were
in unrestricted stock. Final Awards are based on the attainment of performance
goals and on individual performance. (See note 1 for more details on restricted
stock.) The amounts shown represent Final Awards for performance periods ending
in 1996 and 1997. No amount is shown for the performance period ending in 1998
because the awards will not be decided until the middle of 1999. Those amounts
will appear in next year's proxy statement.
(4)These amounts are (1) matching contributions by Ford under the Savings and
Stock Investment Plan ("SSIP") and (2) the values of certain credits provided to
the Named Executives under the Benefit Equalization Plan ("BEP"). Under the BEP,
Ford provides benefits substantially equal to benefits that could not be
provided under the SSIP because of limitations under the Internal Revenue Code.
For 1998, the amounts shown in column (i) as SSIP matching contributions and BEP
credits, respectively, are as follows:
<TABLE>
<CAPTION>
SSIP
Matching BEP
Person Contributions Credits
------ ------------- -------
<S> <C> <C> <C>
Alex Trotman............................................. $9,598 and $140,400
W. Wayne Booker.......................................... $9,598 and $ 33,247
Edward E. Hagenlocker.................................... $9,598 and $ 40,802
Jacques A. Nasser........................................ $9,598 and $ 53,402
Kenneth Whipple.......................................... $9,598 and $ 32,998
</TABLE>
(5)Mr. Trotman retired from the Company effective January 1, 1999.
(6)83% of Mr. Booker's 1996 compensation was for his service as Executive Vice
President. The rest of his 1996 compensation and all of his 1997 and 1998
compensation was for his service as Vice Chairman.
(7)83% of Mr. Hagenlocker's 1996 compensation was for his service as President
of Ford Automotive Operations. The rest of his 1996 compensation and all of his
1997 and 1998 compensation was for his service as Vice Chairman. Mr. Hagenlocker
retired from the Company effective January 1, 1999.
(8)80% of Mr. Nasser's 1996 compensation was for his service as Group Vice
President, Product Development. The rest of his 1996 compensation and all of his
1997 and 1998 compensation was for his service as Executive Vice President and
President of Ford Automotive Operations.
(9)Mr. Whipple retired from the Company effective January 1, 1999.
19
<PAGE> 25
STOCK OPTIONS
The Long-Term Incentive Plan allows grants of stock options and other rights
relating to common stock. In general, whether exercising stock options is
profitable depends on the relationship between the common stock's market price
and the options' exercise price, as well as on the grantee's investment
decisions. Options that are "in the money" on a given date can become "out of
the money" if prices change on the stock market. For these reasons, we believe
that placing a current value on outstanding options is highly speculative and
may not represent the true benefit, if any, that may be realized by the grantee.
The following two tables give more information on stock options.
OPTION/SAR GRANTS IN LAST FISCAL YEAR(1)
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------
Grant Date
Individual Grants Value(3)
- -----------------------------------------------------------------------------------------------------------------
(a) (b) (c) (d) (e) (f)
% of Total
Number of Options/SARs
Securities Granted to Exercise
Underlying Employees or Base Grant Date
Options/SARs in Fiscal Price Expiration Present
Name Granted(#) Year ($/Sh) Date Value $
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Alex Trotman 431,400 2.4% 41.0721 3/14/2008 3,951,624
- -----------------------------------------------------------------------------------------------------------------
W. Wayne Booker 107,850 0.6% 41.0721 3/14/2008 987,906
- -----------------------------------------------------------------------------------------------------------------
Edward E. Hagenlocker 179,750 1.0% 41.0721 3/14/2008 1,646,510
- -----------------------------------------------------------------------------------------------------------------
Jacques A. Nasser 215,700 1.2% 41.0721 3/14/2008 1,975,812
700,000(2) 3.9% 45.4062 10/15/2008 6,958,000
- -----------------------------------------------------------------------------------------------------------------
Kenneth Whipple 107,850 0.6% 41.0721 3/14/2008 987,906
- -----------------------------------------------------------------------------------------------------------------
</TABLE>
NOTES
(1)The exercise price of the stock options is the average of the high and low
selling prices on the New York Stock Exchange on the grant date. Stock
appreciation rights were granted in tandem with these stock options.
In general, 33% of a stock option grant can be exercised one year after the
grant date, 66% after two years, and 100% after three years. Any unexercised
options expire after ten years.
If a grantee retires, becomes disabled, or dies, his or her options continue to
be exercisable up to the normal expiration date. In most other instances of
employment termination, all rights end upon termination.
Options are subject to certain conditions, including not engaging in competitive
activity. Options generally cannot be transferred except through inheritance.
In general, each grantee agrees to remain a Ford employee for at least one year
from the grant of the option.
(2)20% of this stock option grant can be exercised three years after the grant
date, 40% after four years, 60% after five years, 80% after six years and 100%
after seven years. The other terms of this option are generally similar to those
referred to in Note 1 above.
(3)These values were determined using the Black-Scholes methodology and the
assumptions described in Note 11 to Ford's Consolidated Financial Statements
contained in Ford's 1998 Annual Report. The
20
<PAGE> 26
ultimate value of the options, if any, will depend on the future value of the
common stock and the grantee's investment decisions, neither of which can be
accurately predicted.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
(a) (b) (c) (d) (e)
Number of Securities Value
Underlying Unexercised of Unexercised
Options/SARs at FY-End In-the-Money Options/
(#) SARs at FY-End($)(2)
-----------------------------------------------
Shares Acquired Value Realized Exercisable/ Exercisable/
Name on Exercise(#)(1) $ Unexercisable Unexercisable
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------
Alex Trotman 1,428,652 30,060,133 0/ 0/
1,061,963 30,317,224
- ------------------------------------------------------------------------------------------------------------------------------
W. Wayne Booker 127,982 5,107,501 301,618/ 11,153,003/
266,391 7,611,963
- ------------------------------------------------------------------------------------------------------------------------------
Edward E. Hagenlocker 184,695 4,574,370 290,921/ 10,605,756/
495,033 14,531,008
- ------------------------------------------------------------------------------------------------------------------------------
Jacques A. Nasser 0 0 468,786/ 18,163,734/
1,157,285 21,726,167
- ------------------------------------------------------------------------------------------------------------------------------
Kenneth Whipple 170,776 6,529,826 391,120/ 15,385,569/
266,391 7,611,963
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTES
(1)The numbers shown include shares of common stock with respect to which stock
appreciation rights were exercised for cash, as follows: 1,408,865 shares for
Alex Trotman; 127,982 shares for W. Wayne Booker; 174,802 shares for Edward
Hagenlocker; and 79,090 shares for Kenneth Whipple. No shares of common stock
were acquired in connection with the exercise of these stock appreciation
rights.
(2)These year-end values represent the difference between the fair market value
of common stock subject to options (based on the stock's closing price on the
New York Stock Exchange on December 31, 1998) and the exercise prices of the
options. "In-the-money" means that the fair market value of the stock is greater
than the option's exercise price on the valuation date.
PERFORMANCE STOCK RIGHTS AND RESTRICTED STOCK UNITS
Under the Long-Term Incentive Plan, eligible employees may receive
nontransferable Performance Stock Rights. A Performance Stock Right is the right
to receive, after a specified performance period, a Final Award of up to a
certain number of shares of common stock. The number of shares depends on
whether the Performance Stock Right's performance goals are achieved and, for
employees who are not Named Executives, on the employee's individual
performance.
Under the Long-Term Incentive Plan, eligible employees also may receive
nontransferable Restricted Stock Units. A Restricted Stock Unit is the right to
receive, after the restriction period expires and subject to the achievement of
certain goals, cash equal in value to one share of common stock. The final
number of Restricted Stock Units that can be paid out in cash depends on whether
the goals are achieved and on the employee's individual contribution.
21
<PAGE> 27
The following table shows information on 1998 grants of Performance Stock Rights
and Restricted Stock Units to the Named Executives.
LONG-TERM INCENTIVE PLAN-AWARDS IN LAST FISCAL YEAR(1)
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
Estimated Future Payouts
under Non-Stock Price-Based Plans
----------------------------------------
(a) (b) (c) (d) (e) (f)
Performance
Number of or Other
Shares, Units Period Until
or Other Maturation Threshold Target(2) Maximum
Name Rights(#) or Payout (#) (#) (#)
<S> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------------------
Alex Trotman PSRs 215,700 1998-00 0 n/a 323,550
- --------------------------------------------------------------------------------------------------------------------------
W. Wayne Booker PSRs 28,760 1998-00 0 n/a 43,140
RSUs 10,000 Ret. + 18 mos. 0 n/a 10,000
- --------------------------------------------------------------------------------------------------------------------------
Edward E. Hagenlocker PSRs 50,330 1998-00 0 n/a 75,495
RSUs 10,000 Ret. + 18 mos. 0 n/a 10,000
- --------------------------------------------------------------------------------------------------------------------------
Jacques A. Nasser PSRs 71,900 1998-00 0 n/a 107,850
RSUs 350,000 Ret. + 18 mos. 0 n/a 350,000
- --------------------------------------------------------------------------------------------------------------------------
Kenneth Whipple PSRs 28,760 1998-00 0 n/a 43,140
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTES
(1)These entries represent the number of shares specified in Performance Stock
Rights or Restricted Stock Units granted in 1998.
(2)No specific payout targets were created in connection with these grants.
PERFORMANCE STOCK RIGHTS
The Compensation Committee decides the number of shares to be included in a
Final Award by determining how completely certain performance goals were
achieved. Usually, Performance Stock Rights are granted each year. The
performance period is ordinarily three years. For 1998, performance goals for
the Performance Stock Rights reported in column (b) of the table cover the
1998-2000 period and include essentially the same performance measures for each
of the Named Executives. The performance goals and the mechanics of receiving a
Final Award are more fully discussed on pp. 15 and 16.
Dividend Equivalents paid in 1998 to the Named Executives in cash are reported
in column (e) of the Summary Compensation Table on p. 18. Final Awards of common
stock made to the Named Executives for the 1993-97 and 1995-97 performance
periods are reported in column (h) of the Summary Compensation Table.
The amount ultimately realized for a Final Award will depend on the value of the
common stock when the award is made, or if restricted, when the restrictions
lapse and on the "earning out conditions." Under these conditions, if an
employee quits, retires without Company approval, is released in Ford's best
interest, is discharged, or engages in competitive activity after termination,
all of the employee's undistributed Final Awards, as well as outstanding
Performance Stock Rights, will be forfeited and canceled unless a waiver is
granted by the Committee. Further, all of the employee's rights under any award
will be forfeited if the Committee determines that the employee acted in a
manner inimical to
22
<PAGE> 28
Ford's best interests. After any restriction period ends, however, shares of
common stock representing a Final Award are distributed to the employee free of
restrictions and conditions.
RESTRICTED STOCK UNITS
The Committee creates the performance goals for the Restricted Stock Units and
selects the persons who receive the Units. The 1998 grants, reported in column
(b) of the table on p. 22, depend on the achievement of seven major Company
goals described on p. 16. Dividend Equivalents paid to the Named Executives are
included in column (e) of the Summary Compensation Table. No Restricted Stock
Units were paid out in 1998 to any of the Named Executives.
As with Performance Stock Rights, the amount ultimately realized under a
Restricted Stock Unit depends on the achievement of performance goals, the
compliance with certain conditions, and the value of common stock when the
restrictions end.
23
<PAGE> 29
STOCK PERFORMANCE GRAPHS
SEC rules require proxy statements to contain a performance graph comparing,
over a five-year period, the performance of our common stock against Standard &
Poor's 500 Stock Index and against either a published industry or
line-of-business index or a group of peer issuers. Ford chose the other
principal U.S. auto manufacturer -- General Motors -- as its peer issuer for the
graph. We think this approach is more informative since relevant line of
business indexes merely combine the U.S. automakers. In the past, we have also
included Chrysler as a peer issuer. However, we have not included Chrysler this
year due to its merger with Daimler-Benz. In addition to the five-year graph, we
are providing a similar performance graph covering a ten-year period. Both
graphs assume an initial investment of $100, quarterly reinvestment of dividends
and, in the case of Ford common stock, an adjustment to reflect the impact of
the April 7, 1998 spin-off of Ford's interest in Associates First Capital
Corporation.
COMPARISON OF FIVE-YEAR CUMULATIVE SHAREHOLDER RETURN
FORD, GENERAL MOTORS AND S&P 500 STOCK INDEX
<TABLE>
<CAPTION>
FORD GENERAL MOTORS S&P 500
---- -------------- -------
<S> <C> <C> <C>
'1993' 100 100 100
'1994' 88 78 101
'1995' 96 100 139
'1996' 112 109 171
'1997' 176 130 229
'1998' 333 158 294
</TABLE>
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------
1993 1994 1995 1996 1997 1998
---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
FORD 100 88 96 112 176 333
---------------------------------------------------------------------------------------------
GENERAL MOTORS 100 78 100 109 130 158
---------------------------------------------------------------------------------------------
S&P 500 100 101 139 171 229 294
---------------------------------------------------------------------------------------------
</TABLE>
24
<PAGE> 30
COMPARISON OF TEN-YEAR CUMULATIVE SHAREHOLDER RETURN
FORD, GENERAL MOTORS AND S&P 500 STOCK INDEX
<TABLE>
<CAPTION>
FORD GENERAL MOTORS S&P 500
---- -------------- -------
<S> <C> <C> <C>
'1988' 100.00 100.00 100.00
'1989' 91.00 108.00 132.00
'1990' 60.00 94.00 128.00
'1991' 68.00 82.00 166.00
'1992' 108.00 96.00 179.00
'1993' 168.00 166.00 197.00
'1994' 149.00 129.00 200.00
'1995' 161.00 167.00 275.00
'1996' 188.00 181.00 338.00
'1997' 296.00 216.00 451.00
'1998' 559.00 262.00 580.00
</TABLE>
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------
1988 1989 1990 1991 1992 1993 1994 1995
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
FORD 100 91 60 68 108 168 149 161
----------------------------------------------------------------------------------------------------------
GENERAL MOTORS 100 108 94 82 96 166 129 167
----------------------------------------------------------------------------------------------------------
S&P 500 100 132 128 166 179 197 200 275
----------------------------------------------------------------------------------------------------------
<CAPTION>
----------------------------------------------------------------------------------------------------------
1996 1997 1998
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FORD 188 296 559
----------------------------------------------------------------------------------------------------------
GENERAL MOTORS 181 216 262
----------------------------------------------------------------------------------------------------------
S&P 500 338 451 580
----------------------------------------------------------------------------------------------------------
</TABLE>
25
<PAGE> 31
RETIREMENT PLANS
Ford's General Retirement Plan ("GRP") provides a benefit for each year of
noncontributory participation, and added benefits for those who make additional
contributions. Ford also has two other retirement plans, the Supplemental
Executive Retirement Plan ("SERP") and the Benefit Equalization Plan ("BEP").
Under the SERP, certain executives, including the Named Executives, may receive
(1) an additional monthly benefit after retirement based on years of credited
service and final average base salary, and (2) annuities based on Company
earnings, the executive's performance, and other factors. In addition, for
retirements effective October 1, 1998 or later, for certain U.S. Vice Presidents
and above whose careers include subsidiary service, the SERP will provide an
additional monthly benefit to equalize the total retirement benefits payable
from the Company's retirement plans to an amount that would have been payable
under the GRP/BEP if the executive's total service had been recognized as
contributory service under those plans. Under the BEP, eligible employees,
including the Named Executives, receive benefits substantially equal to those
that would have been provided under the GRP but that could not be provided
because of Internal Revenue Code limitations.
The following table shows the annual retirement benefits that would be payable
at normal retirement (age 65 or later) on January 1, 1999. Benefits are shown
for various rates of final average base salary and assume that employee
contributions were made for the indicated periods. Employees contribute at the
rate of 1 1/2% of base salary up to $160,000. The table shows total annual
amounts payable under the GRP, SERP and BEP, including amounts relating to
employee contributions.
ANNUAL CONTRIBUTORY PENSIONS
YEARS OF SERVICE
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
Final
Average
Base Salary 20 Years 25 Years 30 Years 35 Years 40 Years
<S> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------
$ 200,000 $ 83,300 $ 104,400 $ 125,500 $ 146,700 $ 166,100
- -----------------------------------------------------------------------------------------------------------
400,000 194,000 243,200 292,300 341,500 386,700
- -----------------------------------------------------------------------------------------------------------
600,000 304,700 381,900 459,100 536,300 607,300
- -----------------------------------------------------------------------------------------------------------
800,000 423,400 530,600 637,900 745,200 843,900
- -----------------------------------------------------------------------------------------------------------
1,000,000 530,000 664,300 798,700 933,000 1,056,500
- -----------------------------------------------------------------------------------------------------------
1,200,000 636,700 798,100 959,400 1,120,800 1,269,100
- -----------------------------------------------------------------------------------------------------------
1,400,000 743,400 931,800 1,120,200 1,308,600 1,481,700
- -----------------------------------------------------------------------------------------------------------
1,600,000 850,100 1,065,500 1,281,000 1,496,500 1,694,300
- -----------------------------------------------------------------------------------------------------------
1,800,000 956,800 1,199,300 1,441,800 1,684,300 1,906,900
- -----------------------------------------------------------------------------------------------------------
2,000,000 1,063,400 1,333,000 1,602,600 1,872,100 2,119,500
- -----------------------------------------------------------------------------------------------------------
</TABLE>
GRP and BEP benefits are computed by averaging the employee's highest five
consecutive annual base salaries in the ten years immediately before retirement.
SERP benefits generally are computed by averaging the employee's final five
year-end annual base salaries immediately before retirement. No annuities were
awarded in 1993 or 1994. Mr. Trotman received annuities for 1995, 1996 and 1997.
Assuming a retirement age of 65 and satisfaction of all conditions, the
estimated percentage of total annual retirement benefits to be paid to Mr.
Trotman from his annuities is 4%.
26
<PAGE> 32
As of December 31, 1998, the credited years of service for each of the Named
Executives were as follows: Alex Trotman, 43 years; W. Wayne Booker, 40 years;
Edward E. Hagenlocker, 34 years; Jacques A. Nasser, 31 years; and Kenneth
Whipple, 40 years.
The GRP and BEP benefits are computed as a joint-and-survivor annuity. The SERP
benefit is computed as a straight-life annuity. Benefits payable under the plans
are not reduced for Social Security or other offsets.
In addition to the GRP and BEP, Ford maintains a voluntary retirement program
for select U.S. management employees called the Select Retirement Plan ("SRP").
The SRP adds three years of age and contributory service to the employee for
retirement benefits purposes, with a 15% floor on the increase of the employee's
monthly benefits under any applicable retirement plans. The SRP generally
calculates five year final average salary by using final salary for three of the
five years. To participate in the SRP, an employee must be selected by
management and generally must be at least age 52 and have ten or more years of
credited service under the retirement plans.
PROPOSALS REQUIRING YOUR VOTE
In addition to voting for directors, the following six proposals may be voted on
at the meeting. Ford will present Proposal 2 and we expect the remaining five to
be presented by stockholders. In accordance with SEC rules, the text of each of
the proposals is printed exactly as it was submitted.
A majority of the votes that could be cast by stockholders who are either
present in person or represented by proxy at the meeting is required to approve
each proposal. The votes will be computed for each share as described on p. 1.
When providing your proxy, whether by telephone, the Internet, or by mail, you
will be able to designate whether your shares are voted to approve, disapprove,
or abstain from each of the proposals. Instructions for voting for directors can
be found on p. 3.
PROPOSAL 2
SELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS
The Audit Committee of the Board of Directors selects and hires independent
public accountants to audit Ford's books of account and other corporate records.
The Audit Committee's selection for 1999 must be approved by you.
The Audit Committee selected PricewaterhouseCoopers LLP to audit Ford's books of
account and other corporate records for 1999. Coopers & Lybrand L.L.P. (which
has audited Ford's books since 1946) and Price Waterhouse LLP merged July 1,
1998 to form PricewaterhouseCoopers LLP. PricewaterhouseCoopers LLP is well
qualified to continue to audit Ford's books of account and other corporate
records. Representatives of PricewaterhouseCoopers LLP will be present at the
meeting with the opportunity to make a statement and answer questions.
For 1998, Ford paid PricewaterhouseCoopers LLP $64.4 million for world-wide
audit and nonaudit services.
Ford management will present the following resolution to the meeting:
"RESOLVED: That the selection, by the Audit Committee of the Board of Directors,
of PricewaterhouseCoopers LLP as independent public accountants to audit the
books of account and other corporate records of the Company for 1999 is
ratified."
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL 2.
27
<PAGE> 33
PROPOSAL 3
AFFIRMATION OF THE COMPANY'S POLITICAL NON-PARTISANSHIP
Mrs. Evelyn Y. Davis, Suite 215, Watergate Office Building, 2600 Virginia Ave.,
NW, Washington, D.C. 20037, and Highlights and Lowlights, who state that they
together own 200 shares of common stock, have informed the Company that they
plan to present the following proposal at the meeting:
"RESOLVED: That the stockholders of Ford Motor assembled in Annual Meeting in
person and by proxy, hereby recommend that the Corporation affirm its political
non-partisanship. To this end the following practices are to be avoided:
(a) The handing of contribution cards of a single political party to an
employee by a supervisor.
(b) Requesting an employee to send a political contribution to an
individual in the Corporation for a subsequent delivery as part of a
group of contributions to a political party or fund raising committee.
(c) Requesting an employee to issue personal checks blank as to payee for
subsequent forwarding to a political party, committee or candidate.
(d) Using supervisory meetings to announce that contribution cards of one
party are available and that anyone desiring cards of a different party
will be supplied one on request to his supervisor.
(e) Placing a preponderance of contribution cards of one party at mail
station locations.
REASONS: The Corporation must deal with a great number of governmental units,
commissions and agencies. It should maintain scrupulous political neutrality to
avoid embarrassing entanglements detrimental to its business. Above all, it must
avoid the appearance of coercion in encouraging its employees to make political
contributions against their personal inclinations. The Troy (Ohio) News has
condemned partisan solicitation for political purposes by managers in a local
company (not Ford). And if the Company did not engage in any of the above
practices, to disclose this to ALL shareholders in each quarterly report. Last
year the owners of 50,217,254 shares, representing 3.2% of shares voting, voted
FOR this proposal.
If you AGREE, please mark your proxy FOR this resolution."
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "AGAINST" PROPOSAL 3.
This proposal seeks to outline certain practices that the Company should not
engage in with respect to the political process and would require the Company to
publish and distribute a quarterly report disclosing that such practices have
not been engaged in by the Company. Because Ford Motor Company does not engage,
and has never engaged, in any of the practices set forth in this proposal, we
believe that this proposal would not result in any appreciable benefit to the
stockholders or the Company and would be costly to implement and is, therefore,
not in your best interest or those of Ford.
Existing Ford policy dictates that the Company not make contributions in the
United States to political candidates or political organizations, even when
permitted by law. This policy further provides that Ford does not take positions
or use its resources for partisan political purposes, although senior management
may approve certain contributions to support or oppose ballot questions if the
issues raised directly affect Ford.
With respect to contributions by employees, Ford has established the Ford Civic
Action Fund as a political action committee in accordance with the Federal
Election Campaign Act of 1971, as amended (the "Fund"). The Fund is not
affiliated with any political party nor with any specific candidate for
28
<PAGE> 34
election. The Fund provides a means by which individuals may make contributions
which the Fund distributes to candidates for public office. All of the
contributions made by the Fund are derived from voluntary employee
contributions. No coercion is exerted on any employee to induce or compel a
contribution. Contributions to the Fund may not be solicited or secured through
the use of job discrimination or financial reprisal, or the threat thereof, or
as a condition of employment.
Given that the Company does not engage in the practices described in the
proposal and its existing policies with respect to political non-partisanship,
we believe that the proposal would not result in any meaningful benefit to the
stockholders or the Company. As a result, we believe that the expenditures
required to implement the proposal are unnecessary and would serve no useful
purpose for stockholders or Ford.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "AGAINST" PROPOSAL 3.
PROPOSAL 4
REPORT ON GLOBAL WARMING
A number of stockholders have informed the Company that they plan to present the
following proposal at the meeting. The names, addresses and information on the
number of shares owned by them will be provided upon request.
"WHEREAS:
The overwhelming majority of independent, peer-reviewed atmospheric scientists
agree that global warming is not hypothetical but a real, existing problem
posing serious challenges for modern civilization;
The Intergovernmental Panel on Climate Change (IPCC), composed of more than 2000
scientists nominated and reviewed by governments, warns that global warming
caused by burning fossil fuels and emitting greenhouse gases is already under
way;
The impacts of global warming on our public health and welfare include increased
occurrence of extreme weather events, sea-level rise, increased spread of
infectious diseases, and more frequent and deadly heat waves like the summer of
1998 which was linked to more than 150 deaths in Texas alone.
WE BELIEVE:
It will cost U.S. taxpayers billions of dollars to combat the impacts of global
warming. So far, our company has not lived up to its responsibility as a
producer of the pollution which causes global warming. In order to leave the
children of the world a safe and healthy environment, and protect threatened
plants and animals, it is time for Ford to lead by example. A variety of
companies including Toyota, British Petroleum, 3M, Enron and others have stated
that they "accept the views of most scientists that enough is known about the
science and environmental impacts of climate change for us to take actions to
address its consequences." These companies are preparing for the future now by
taking the concrete steps necessary to assess their opportunities for reducing
the amount of carbon pollution they produce. Failing to rise to the challenge
set by these industry leaders will hurt our company's competitiveness and cost
our shareholders increasing amounts of money.
RESOLVED: that the shareholders of Ford request that the Board of Directors
report (at reasonable costs and omitting proprietary information), to
shareholders by August 1999, on the greenhouse gas emissions from our company's
own operations and products, including (with dollar amounts where relevant) (i)
what our company is doing in research and/or action to reduce those emissions
and ameliorate the problem, (ii) the financial exposure of our company and its
shareholders due to the
29
<PAGE> 35
likely costs of reducing those emissions and potential liability for damages
associated with climate change, and (iii) actions by our company, or by the
industry associations to which it pays dues, promoting the view that the issue
of climate change is exaggerated, not real, or that global warming may be
beneficial.
SUPPORTING STATEMENT
We believe that Ford is exposing its shareholders to financial risk by
continuing to produce unnecessary amounts of the pollution which causes global
warming, even as the problem of climate change becomes more severe, more widely
understood, and more likely to lead to legislation that will penalize excessive
carbon polluters. Furthermore, we believe that our company is incurring costs
for advertising and lobbying to suggest that the problem of global warming is
exaggerated, not real, or too costly to deal with; and thus using our prestige
and influence to delay any lessening of climate change."
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "AGAINST" PROPOSAL 4.
We take exception to the assertion in the proposal that Ford "has not lived up
to its responsibility as a producer of the pollution which causes global
warming." We are firmly committed to the principle that we must operate in an
environmentally responsible, efficient and safe manner. Ford recognizes that
concern for the quality of the environment warrants extraordinary efforts on the
part of those in a position to protect and improve it. Accordingly, we have
adopted and implemented environmental policies which, in many respects, go
beyond legal mandates. Moreover, we pursue a policy under which our products,
plants and production processes continually are updated, rebuilt, redesigned or
replaced to be more energy efficient, produce less waste and lessen the
environmental impact from air and water discharges. Most recently, the Board of
Directors created a committee of the Board -- the Environmental and Public
Policy Committee -- devoted to consideration of environmental issues facing the
Company.
Our environmental concern and stewardship extends to global climate change. We
are keenly aware of the possible consequences of global warming and take our
responsibilities to our customers and the planet very seriously. We have made
tremendous progress already in this area and we see extraordinary promise in our
future product plans for making still more environmentally friendly vehicles,
including new technologies that will significantly reduce fuel consumption and,
therefore, CO2 emissions.
Ford today is engaged in numerous environmental initiatives, many of which are
beneficial in reducing CO2 emissions and energy use:
- - Ford is the worldwide leader in producing vehicles that operate on
lower-carbon fuels, such as natural gas and propane;
- - Ford is participating in the Partnership for a New Generation Vehicle (PNGV)
joint program between government and industry and is developing high-mileage,
low emission hybrid and fuel cell vehicles through its P2000 research program;
- - Fully half of the research done in our three worldwide scientific research
laboratories is environmental research; and
- - Our plant facilities are continuously improving their energy efficiency and
reducing waste.
At the same time, we continue to believe that any actions taken in respect of
global warming must include all nations and that wide-ranging development of
advanced energy-saving technologies is the right approach. Although the
scientific facts are not all in, greenhouse gas emissions and global
30
<PAGE> 36
temperatures are increasing and government and industry should take action,
including those highlighted above, to address this potential threat.
Ford's position on climate change and environmental stewardship is well known
and has been publicly stated numerous times. The report called for by the
stockholder proposal would not provide significantly different information than
that already readily available to the public.
For these reasons, we believe the proposal is unnecessary, would be burdensome
to implement, and would not result in any appreciable benefit for our
stockholders or the Company.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "AGAINST" PROPOSAL 4.
PROPOSAL 5
PROPOSAL FOR GLOBAL SET OF CORPORATE STANDARDS
A number of stockholders have informed the Company that they plan to present the
following proposal at the meeting. The names, addresses and information on the
number of shares owned by them will be provided upon request.
"WHEREAS, our company, as a major global corporation, faces a number of complex
problems which also affect our interests as shareholders. The international
context within which our company operates is becoming increasingly diverse as we
approach the year 2000.
Companies operating in this global economy are faced with important concerns
arising from diverse cultures and political and economic contexts, some which
force management to address issues beyond the traditional business focus. These
concerns include human rights, child labor, forced labor, non-discrimination in
the workplace, the environment, and sustainable community development.
We believe global companies need to develop comprehensive codes of conduct to
guide the formulation of company policies, programs and practices to address the
new challenges they face in the global marketplace. In fact many companies are
recognizing these challenges and revising their traditional codes and guidelines
to meet these new realities.
In April 1997 the White House Apparel Industry Partnership issued its report
setting out a Workplace Code of Conduct and Principles of Monitoring for the
apparel and footwear industry. The standards in that report, based on
international human and labor rights conventions, if implemented comprehensively
and diligently, are intended to eliminate poor working conditions for workers in
the United States and abroad.
Our company should be in a position to assure shareholders that its employees
are treated and paid fairly wherever they work in the global economy. One
important element of ensuring compliance is the utilization of independent
monitors made up of respected local human rights, religious and other non-
governmental organizations. A number of global companies are involved in the
development of credible code enforcement mechanisms that include independent
monitoring.
Improving the quality of life for employees and their communities can lead to
increased productivity and enhance the bottom line for the company.
RESOLVED: Shareholders request the Board of Directors to review or amend, where
applicable, its code or standards for its international operations and to report
a summary of this review to shareholders by September 1999. The review should
include the following areas:
1. A description of policies which are designed to protect human
rights -- civil, political, social and economic -- consistent with respect
for human dignity and international human rights standards.
31
<PAGE> 37
2. A report of efforts to ensure that the company does not employ children under
the age of fifteen, or younger than the age for completing compulsory
education in the country of manufacture where such age is higher than
fifteen.
3. A report of company policies ensuring that there is no use of forced labor,
whether in the form of prison labor, indentured labor or bonded labor.
4. Establishment of consistent standards for workers' health and safety,
practices for handling hazardous wastes and protecting the environment, as
well as promoting a fair and dignified quality of life for workers and their
communities."
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "AGAINST" PROPOSAL 5.
The Company has conducted business on a global basis for many years and the
Board of Directors is experienced in dealing with, and sensitive to, the
concerns addressed in this proposal. To help ensure the protection of our
employees, we have global policies in place that provide for the fair treatment
of all of our employees around the world. These policies, of which the Board is
fully aware, have contributed to our history of fair and equitable treatment of
our employees at all Company locations.
The Board of Directors is satisfied that our employees around the world are
treated fairly and paid a competitive wage. The Board is also satisfied that
current Company policies as they relate to employment matters protect our
employees wherever they may be located. As a result, the Board is opposed to
this proposal on the grounds that it would not produce any significant change in
policy or practices or otherwise benefit the Company, its stockholders or
employees and would be extremely burdensome and costly to implement.
While it is not practicable to set forth here all of the relevant policies of
the Company and related practices, a few examples that address matters raised by
the proposal are worth noting:
- Ford policy requires, at a minimum, that all of its facilities comply
with applicable laws dealing with worker health, safety, welfare, wages
and benefits and the environment.
- Ford has established as a committee of its Board of Directors -- the
Environmental and Public Policy Committee -- devoted to considering
environmental issues facing the Company.
- Ford does not employ child labor (even where local law might otherwise
permit it), nor does it employ prison or forced labor.
- Ford policy prohibits discrimination in hiring or promotional opportunity
based on color, race, religion, gender, or country of national origin.
Because the Board regularly monitors its global policies and practices to ensure
that Company employees around the world are treated fairly and that the Company
is operating in a conscientious and ethical manner, we believe that the review
requested by the proposal is unnecessary and would not provide any additional
information not already known to the Board or to our stockholders. Furthermore,
the review and report would be extremely burdensome and costly and would not
produce any significant change in policy or practice or otherwise benefit the
Company, its stockholders or employees, either in real terms or in the longer
term.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "AGAINST" PROPOSAL 5.
32
<PAGE> 38
PROPOSAL 6
STUDY TO ADD FORD EMPLOYEE(S) TO THE BOARD OF DIRECTORS
Richard A. Mills, 740 Tobin Drive, Apt. 205, Inkster, Michigan, who states that
he is a Ford salaried employee and the owner of 63 shares of common stock, has
informed the Company that he plans to present the following proposal at the
meeting:
"WHEREAS:
Ford Employees own approximately 20% of all Ford Motor Company Stock.
Jacques A. Nasser says that "employees need to act like owners of the company."
The only Ford Employees on the Board of Directors are Executive Officers of the
company.
The Board of Directors will be making far-reaching decisions that involve the
livelihood of its employees.
LET IT BE RESOLVED:
The Board of Directors will appoint a committee to study the addition of
Employee Directors. The committee will get input from hourly and salaried (SCR
and below) employees and make recommendations back to The Board of Directors
within 6 months as to the following:
Number of Employee Directors to be added to The Board of Directors.
How the Employee Director(s) will be selected/nominated.
Which committee(s) the Employee Director(s) will serve on.
The Board of Directors will be required to vote for or against adopting the
recommendation(s) of The Committee prior to the 2000 Annual Stockholders
Meeting.
Ford Employee Stockholders recommend a Vote "for" this Proposal."
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "AGAINST" PROPOSAL 6.
The Board of Directors and the senior management of Ford recognize the
substantial stake our employees have and the critical role they play in the
success of the Company both as a means of providing a livelihood for our
employees and their families and as owners of the Company. As a result, input
from employees on management decisions is valued and appreciated. In an effort
to facilitate such a dialog, a number of forums are provided each year to
solicit such input. Members of senior management regularly conduct "town hall"
meetings and other forums at various locations where Ford has operations to
listen to the concerns of employees and to hear their ideas for making our
Company better. More importantly, all employees are encouraged to participate
fully in decisions that impact the day-to-day operations of the Company.
However, we believe that appointment of a new committee to make recommendations
on "employee directors" is unnecessary and would not result in any change to the
Board of Directors.
The Company currently has a committee of the Board that serves substantially the
same function as the committee called for by the proposal. The Organization
Review and Nominating Committee of the Board of Directors is responsible for
reviewing and making recommendations with respect to the size and composition of
the Board and regarding nominations and elections of directors. In furtherance
of these responsibilities, the Organization Review and Nominating Committee also
considers stockholder, including employee stockholder, suggestions for director
nominees before the proxy materials are mailed each year. (See page 8 for
information on where to send nominations.)
33
<PAGE> 39
The complexity of the Company requires that the Board of Directors consist of
individuals with a broad range of experience and knowledge. As a result, the
current directors come from a wide array of industries, companies and
educational and other institutions. The Committee believes that the Company has
been well served by its current policy on board membership, which selects
nominees for election based on criteria including overall business experience
and specific expertise.
We do not believe that a new committee to study specifically the need for adding
employee directors to the Board of Directors is necessary or would result in the
addition of a director to represent, as the proponent recommends, the interests
of employee stockholders. Under Delaware law, each member of the Board of
Directors owes a fiduciary duty to the Company and to all of the stockholders of
the Company to act in their collective best interests. It would be contrary to
this principle to nominate a director to represent the interests of a relatively
small number of stockholders to the potential disadvantage of the vastly larger
number of non-employee stockholders.
Furthermore, we believe that it would not be in the best interest of the Company
or its stockholders to select nominees to the Board only because the nominees
represent a specific group of stockholders. Rather, we believe that all nominees
should be selected based on their level of business experience, the specific
expertise the nominees bring to the Board and other positive qualifications of
the nominees.
Because the Company already has a committee of the Board that serves
substantially the same function as the committee called for by the proposal and
because each of the Company's directors should and must represent the collective
interests of all of you, we do not believe that adoption of this proposal would
be in your best interests or in the best interests of Ford.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "AGAINST" PROPOSAL 6.
34
<PAGE> 40
PROPOSAL 7
INDEPENDENT DIRECTORS TO SERVE ON ALL KEY BOARD COMMITTEES
John Chevedden of 2215 Nelson Avenue, Number 205, Redondo Beach, California
90278, on behalf of Ray T. Chevedden and Veronica G. Chevedden, who own 1,000
shares of common stock, has informed the Company that he plans to present the
following proposal at the meeting:
"RESOLVED:
APPOINT COMPLETELY INDEPENDENT DIRECTORS TO ALL KEY BOARD COMMITTEE POSITIONS TO
ENHANCE MANAGEMENT OVERSIGHT. (Shareholder recommendation) Key board committees
include:
- Audit
- Compensation
- Nomination
SUPPORTING STATEMENT:
This resolution follows the widely-acclaimed Campbell Soup Corporate Governance
Standards:
THE AUDIT, COMPENSATION/ORGANIZATION AND GOVERNANCE COMMITTEES WILL CONSIST
ENTIRELY OF INDEPENDENT DIRECTORS.
Source: 12-page Business Week report "The Best & The Worst Boards," December 8,
1997.
The following news reports highlight the need for INDEPENDENT oversight:
Ford Europe lost $273 million in the 3rd quarter, about twice the 1997 loss.
Associated Press Online Oct. 14, 1998
Ford's Taurus gets Consumer Report's worst reliability rating.
Wall Street Journal March 26, 1998
Ford's profit overly dependent on gas-thirsty sport-utilities -- particularly
deadly to smaller vehicles.
Business Week Dec. 21, 1998
Industry observers say $50,000 Lincoln pickup proves Detroit has gone overboard.
Business Week April 13, 1998
Full-size sport utility vehicles allowed to emit 3-times the nitrogen-oxide of
cars.
Associated Press Online Nov. 3, 1998
18 class-action lawsuits are filed, 22 states investigate Ford Motor Credit for
hiding lease fees.
Associated Press Online Nov. 23, 1998
Greater independent oversight is needed for Ford resolutions. IN 1998 FORD ASKED
SHAREHOLDERS TO APPROVE LAVISH STOCK OPTIONS THAT DILUTE FORD STOCK BY 23%.
Institutional Shareholder Services (www.cda.com/iss) recommended rejection. More
than 33% of the non-family Ford stock rejected it. This was 29-times the
rejection of the poorest showing director, Mr. Reichardt.
35
<PAGE> 41
LACK OF INDEPENDENCE ANALYSIS FOR FORD DIRECTORS
<TABLE>
<CAPTION>
DIRECTOR YEARS ON BOARD(A) ADDITIONAL LACK OF INDEPENDENCE CRITERI
- -------- ----------------- -----------------------------------------
<S> <C> <C> <C>
Dingman 28 years(a) On 2 Key Committees(b)
Ford, Edsel 11 years(a)
Ford, Wm. C. 51 years(a) On 1 Key Committee(b)
Ford, Wm. C., Jr. 11 years(a) On 1 Key Committee(b)
Hockaday 12 years(a) 5 board seats(c) On 1 Key Committee(b)
Kravis 5 board seats(c) On 2 Key Committees(b)
Marram 11 years(a) On 2 Key Committees(b)
Neal 4 board seats(c) On 2 Key Committees(b)
Reichardt(d) 12 years(a) 10 board seats(c) On 1 Key Committee(b)
Thornton(e) 5 board seats(c) On 2 Key Committees(b)
Trotman, employee 5 board seats(c) On 1 Key Committee(b)
</TABLE>
(a) [This alone applies to 64% of directors] CalPERS argued that directors who
stay for a decade should not be considered independent.
Business Week Sept. 15, 1997
(b) [55% of directors] Institutional Shareholder Services recommends that only
independent outside directors serve on key board committees.
(c) [55% of directors] The more boards a director sits on, the less effective
he'll probably be.
Business Week Nov. 25, 1996
(d) Business Week highlighted Mr. Reichardt as "Stretched too thin?" with his 10
board seats. Reichardt on 11th worst board, troubled HMO Columbia/HCA.
(e) Managing Director of Goldman, Sachs -- Entrenched Ford investment banking
firm with $10 million-plus Ford business.
To enhance independent Board oversight:
APPOINT INDEPENDENT DIRECTORS TO ALL KEY BOARD COMMITTEES
YES ON 7"
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "AGAINST" PROPOSAL 7.
We believe that adoption of this proposal is contrary to the interests of Ford
and you. This proposal is unduly restrictive and would deprive Ford of the
services of highly qualified directors on the committees of its board of
directors.
Ford is a large and complex company. Its directors come from a wide array of
industries, companies and educational and other institutions, and have a broad
range of experience and knowledge. Ford has been well served by its present
policy on board and committee membership, which selects nominees for election
based on criteria, including overall business experience and specific expertise,
and giving due consideration of any relationships with the Company. Any material
relationships between Ford and any director are disclosed under SEC rules. (See
p.12 of this Proxy Statement.)
We note that there is only one Ford employee on the Board of Directors. Adoption
of this proposal would unduly restrict the candidates available for service on
the committees of the Board. It also would exclude from consideration as
potential board committee members candidates who have sound judgment, extensive
experience, and a thorough knowledge of the operations of the Company. We
believe that Ford's current policies regarding the independence of directors are
appropriate.
36
<PAGE> 42
For these reasons, we believe that the proposal is unnecessary and not in the
best interests of Ford or you.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "AGAINST" PROPOSAL 7.
STOCKHOLDER PROPOSALS FOR 2000
Any stockholder proposal intended for inclusion in the proxy material for the
2000 annual meeting must be received no later than December 15, 1999.
Stockholder proposals submitted outside of the process described in Rule 14a-8
of the Securities Exchange Act of 1934, as amended, will not be considered at
any annual meeting of stockholders. The Company will not include in the Notice
of Annual Meeting proposals not in compliance with Rule 14a-8 and, under the
Company's by-laws, no business other than that stated in the notice of meeting
can be transacted at the meeting.
ANNUAL REPORT AND OTHER MATTERS
Ford's 1998 Annual Report, including consolidated financial statements, was
recently mailed to you. A list of the stockholders of record entitled to vote at
the annual meeting will be available for review by any stockholder, for any
purpose related to the meeting, between 9:00 a.m. and 5:00 p.m. at the Detroit
Opera House, 1526 Broadway, Detroit, Michigan, for ten days prior to the
meeting.
EXPENSES OF SOLICITATION
The cost of soliciting proxies in the accompanying form will be paid by Ford. We
do not expect to pay any fees for the solicitation of proxies, but may pay
brokers, nominees, fiduciaries and other custodians their reasonable fees and
expenses for sending proxy materials to beneficial owners and obtaining their
instructions. In addition to solicitation by mail, proxies may be solicited in
person, or by telephone, facsimile transmission or other means of electronic
communication, by directors, officers and other employees of the Company.
JOHN M. RINTAMAKI
John M. Rintamaki
Secretary
April 16, 1999
37
<PAGE> 43
HOW TO ATTEND THE ANNUAL MEETING
STOCKHOLDERS OF RECORD
When you provide your proxy, please let us know if you plan to attend the annual
meeting. If you indicate that you plan to attend, we'll mail you a ticket that
will admit the named stockholder(s) and one guest. If your ticket does not
arrive in time, we can issue you a ticket at the door.
"STREET NAME" HOLDERS
Since most brokers don't participate in our advance ticket plan, tell your
broker you're planning to attend the meeting and would like a "legal proxy."
Then simply bring that form to the meeting, and we'll give you a ticket at the
door that will admit you and one guest. If you can't get a legal proxy in time,
we can still give you a ticket at the door if you bring a copy of your most
recent brokerage account statement showing that you own Ford stock.
DIRECTIONS TO THE ANNUAL MEETING SITE
The meeting is being held at the Detroit Opera House, 1526 Broadway, Detroit,
Michigan. The general telephone number for the Detroit Opera House is (313)
961-3500. Directions to the Detroit Opera House are as follows:
I-75 -- SOUTHBOUND
Exit Madison Avenue from I-375 (left side of freeway). From Madison, turn left
on John R.
DUE TO ANTICIPATED CONSTRUCTION ON I-75, STOCKHOLDERS SHOULD CONSIDER AN
ALTERNATE ROUTE.
I-75 -- NORTHBOUND
Take I-96 Westbound to I-94. Exit to I-94 Eastbound. Exit I-94 to U.S. 10 (John
C. Lodge) Southbound. Then follow directions below.
DUE TO ANTICIPATED CONSTRUCTION ON I-75, STOCKHOLDERS SHOULD CONSIDER AN
ALTERNATE ROUTE.
WOODWARD AVENUE -- SOUTHBOUND
Pass the Fox Theatre and turn left onto Witherell (after Grand Circus Park).
Turn right onto Broadway.
JEFFERSON -- WESTBOUND
Turn right onto Woodward, right onto Witherell, right onto Broadway.
U.S. 10 (JOHN C. LODGE) -- SOUTHBOUND
Exit at Bagley. Turn right onto Park when you reach Grand Circus Park. (Park
turns into Witherell as it crosses Woodward.) Turn right onto Broadway.
I-94 -- WESTBOUND/EASTBOUND
Exit U.S.10 (John C. Lodge) Southbound. Then follow directions above.
38
<PAGE> 44
MAP
39
<PAGE> 45
NOTICE OF
1999
ANNUAL MEETING
OF STOCKHOLDERS
AND
PROXY STATEMENT
[RECYCLED LOGO] [SOY INK LOGO]
This Proxy Statement is printed
entirely on recycled and recyclable
paper. Soy ink, rather than
petroleum-based ink, is used. [FORD LOGO]
<PAGE> 46
PROXY
[FORD LOGO]
FORD MOTOR COMPANY
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR THE ANNUAL MEETING OF
STOCKHOLDERS
The undersigned hereby appoints JOHN M. DEVINE and JOHN M. RINTAMAKI, or either
of them, proxies with power of substitution, to vote all the shares of Common
Stock which the undersigned is entitled to vote on all matters, unless the
contrary is indicated on the reverse side hereof, which may come before Ford
Motor Company's Annual Meeting of Stockholders to be held at the Detroit Opera
House, 1526 Broadway, Detroit, Michigan at 10:00 a.m., eastern daylight savings
time, on May 13, 1999, and any adjournments thereof.
THE PROXIES SHALL VOTE THE SHARES REPRESENTED BY THIS PROXY IN THE MANNER
INDICATED ON THE REVERSE SIDE HEREOF. UNLESS A CONTRARY DIRECTION IS
INDICATED, THE PROXIES SHALL VOTE THE SHARES (A) "FOR" THE ELECTION AS
DIRECTORS OF ALL THE NOMINEES NAMED IN THE PROXY STATEMENT AND LISTED BELOW OR
ANY OTHER PERSON SELECTED BY THE BOARD OF DIRECTORS IN SUBSTITUTION FOR ANY OF
THE NOMINEES (PROPOSAL 1) AND (B) "FOR" PROPOSAL 2, "AGAINST" PROPOSALS 3,4,5,6
AND 7 EACH OF WHICH IS SET FORTH IN THE PROXY STATEMENT.
------------------------
<TABLE>
<CAPTION>
Proposal 1 - Election of Directors - Nominees:
<S> <C> <C>
01. Michael D. Dingman 05. Irvine O. Hockaday, Jr. 09. Homer A. Neal
02. Edsel B. Ford II 06. Marie-Josee Kravis 10. Carl E. Reichardt
03. William Clay Ford 07. Ellen R. Marram 11. John L. Thornton
04. William Clay Ford, Jr. 08. Jacques A. Nasser
- --------------------------------------------------------------------------------
ADDRESS CHANGE: PLEASE NOTE CHANGE HERE AND MARK BOX ON REVERSE SIDE
- --------------------------------------------------------------------------------
(Continued and to be signed on reverse side)
- ------------------------------------------------------------------------------------------------------------------------------------
/\ DETACH PROXY CARD HERE IF YOU ARE VOTING BY MAIL AND RETURN IN ENCLOSED ENVELOPE /\
</TABLE>
[FORD LOGO]
ANNUAL MEETING OF STOCKHOLDERS
MAY 13, 1999, 10:00 A.M.
THE DETROIT OPERA HOUSE
1526 BROADWAY
DETROIT, MICHIGAN
<PAGE> 47
<TABLE>
<CAPTION>
[X] PLEASE MARK YOUR VOTES AS IN THIS EXAMPLE
- ------------------------------------------------------------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF ALL MANAGEMENT NOMINEES AND FOR PROPOSAL 2.
- ------------------------------------------------------------------------------------------------------------------------------------
<S><C>
FOR WITHHELD FOR AGAINST ABSTAIN
Proposal 1 - Election [ ] [ ] Proposal 2 - Ratification of [ ] [ ] [ ]
of Directors Selection of Independent
(see reverse) Public Accountants
For, except vote withheld from the following nominee(s):
- -----------------------
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST PROPOSALS 3,4,5,6, AND 7.
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR AGAINST ABSTAIN
Proposal 3 - Relating to Political Non-Partisanship [ ] [ ] [ ]
Proposal 4 - Relating to Global Warming [ ] [ ] [ ]
Proposal 5 - Relating to a Set of Global Corporate Standards [ ] [ ] [ ]
Proposal 6 - Relating to Employee Directors on the Board of Directors [ ] [ ] [ ]
Proposal 7 - Relating to Independent Directors on Key Board Committees [ ] [ ] [ ]
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Request Annual Meeting Ticket YES [ ] NO [ ]
Address Change YES [ ] NO [ ]
Discontinue duplicate Annual Report
mailing for this account YES [ ] NO [ ]
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
SIGNATURE(S) DATE
------------------------------------ --------------------
NOTE: PLEASE SIGN EXACTLY AS NAME APPEARS HEREON. JOINT OWNERS SHOULD EACH SIGN.
WHEN SIGNING AS ATTORNEY, EXECUTOR, ADMINISTRATOR, TRUSTEE OR GUARDIAN,
PLEASE GIVE FULL TITLE AS SUCH.
- --------------------------------------------------------------------------------
[FORD LOGO]
INSTRUCTIONS FOR TELEPHONE AND INTERNET VOTING
Available 24 hours a day, 7 days a week
- --------------------------------------------------------------------------------
ON A TOUCH-TONE PHONE CALL TOLL FREE 1-877-779-8683 (OUTSIDE THE US AND CANADA
CALL 201-536-8073) AND YOU WILL HEAR THESE INSTRUCTIONS:
- --------------------------------------------------------------------------------
- Enter the last four digits of your social security number; and
- Enter the control number from the box just below the perforation on the
proxy card.
- You will then have two options:
OPTION 1: to vote as the Board of Directors recommends on all proposals; or
OPTION 2: to vote on each proposal separately.
- Your vote will be repeated to you and you will be asked to confirm it.
- --------------------------------------------------------------------------------
LOG ONTO THE INTERNET AND TYPE: HTTP://WWW.EPROXYVOTE.COM/F
- --------------------------------------------------------------------------------
- Have your proxy card ready and follow the simple instructions.
Your electronic vote authorizes the named proxies to vote your shares to
the same extent as if you marked, signed, dated and returned the proxy card.
IF YOU HAVE VOTED BY PHONE OR INTERNET, YOU DO NOT NEED TO
RETURN YOUR PROXY CARD.
THANK YOU FOR VOTING!
