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One American Road, Dearborn, MI 48126

Dear Stockholder:

     You are invited to attend a special meeting of stockholders at The Playhouse Theatre, DuPont Building, 10th and Market Streets, Wilmington, Delaware, on August 2, 2000 at 8:30 a.m., eastern daylight savings time.

     At the special meeting, you will be asked to consider and vote upon a recapitalization proposal. The recapitalization will consist of the exchange by Ford with its stockholders of cash and new shares of stock for existing shares of stock, which will result in a reshuffling of the capital structure of Ford. Pursuant to the recapitalization, which will be effected through the merger of a wholly-owned subsidiary of Ford into Ford, each Ford stockholder will have the right to elect to receive the following for each share of common stock or Class B stock owned by such stockholder:

     The cash payable in the recapitalization will be subject to proration if necessary to limit the amount paid to $10 billion.

     An all stock election will increase your percentage ownership interest in Ford, a combination stock and cash election will maintain approximately 99% of your ownership interest, and a $20 cash election will further reduce your ownership interest. Any election other than an all stock election will have the same effect as if you sold some of your shares for cash.

     If you fail to validly make an election, you will be deemed to have made a $20 cash election.

     The attached proxy statement includes information as to the elections available to you and how to make them on pages 24 and 21.

     Adoption of the recapitalization agreement will constitute approval of certain amendments to Ford’s restated certificate of incorporation. The shares of new Ford common stock will continue to be traded on the New York Stock Exchange under the symbol “F.”

     The accompanying proxy statement provides detailed information about the recapitalization. Please read the entire proxy statement and the appendices carefully. For risks in connection with the recapitalization, see “Risk Factors” beginning on page 17.

     Our board of directors has approved the recapitalization agreement and recommends that you vote FOR the adoption of the recapitalization proposal and urges you to sign, date and mail the enclosed proxy in the postage-paid envelope or instruct us by telephone or via the Internet as to how you would like your shares voted.

     Thank you for your continued support.

	/s/ William Clay Ford
	William Clay Ford, Jr.
	Chairman

     Neither the SEC nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this document. Any representation to the contrary is a criminal offense.

     This proxy statement is dated June 29, 2000, and is first being mailed to stockholders on or about July 3, 2000.

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NOTICE OF SPECIAL MEETING OF STOCKHOLDERS

       A special meeting of stockholders of Ford Motor Company will be held at The Playhouse Theatre, DuPont Building, 10th and Market Streets, Wilmington, Delaware, on August 2, 2000 at 8:30 a.m., eastern daylight savings time. The purpose of the meeting is to consider and vote upon a proposal to adopt a Recapitalization Agreement and Plan of Merger dated as of June 27, 2000, between Ford Motor Company and Ford Value Corporation, a wholly owned subsidiary of Ford Motor Company, providing for the merger of Ford Value Corporation with and into Ford Motor Company, with Ford Motor Company as the surviving corporation.

      In the merger each share of common stock and Class B stock will be converted into and exchanged for the right to receive, based upon the holder’s election and subject, in certain circumstances, to proration, one of the following: (i) one share of a new class of Ford common stock or new Ford Class B stock, as the case may be, and $20 in cash, (ii) one share of a new class of Ford common stock or new Ford Class B stock, as the case may be, and $20 in a new class of Ford common stock, or (iii) one share of a new class of Ford common stock or new Ford Class B stock, as the case may be, and $20 in a combination of a new class of Ford common stock and cash, in each case, as calculated as provided in the Recapitalization Agreement and Plan of Merger. In the event that the average of the Ford trading prices over the five trading day period ending on July 28, 2000 exceeds $60, the $20 amounts referred to above will be increased, as provided in such agreement. A copy of the Recapitalization Agreement and Plan of Merger is attached as Appendix A to the proxy statement accompanying this notice.

      The record date for the special meeting is June 27, 2000. Only stockholders of record at the close of business on that date can vote at the meeting. A list of Ford stockholders entitled to vote at the special meeting will be available for examination, during ordinary business hours, for ten days before the meeting at Ford’s principal place of business, One American Road, Dearborn, Michigan and at the offices of Morris, Nichols, Arsht & Tunnell, 1201 N. Market Street, Wilmington, Delaware.

      A form of proxy and a proxy statement containing more detailed information with respect to the matters to be considered at the special meeting are included with this notice.

      The board of directors recommends that you vote in favor of the recapitalization proposal.

      Adoption of the Recapitalization Agreement and Plan of Merger is the only matter to be presented or acted upon at the special meeting. Under our by-laws, no business besides that stated in the meeting notice may be transacted at any meeting of stockholders. If any procedural 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.

	/s/ John M. Rintamaki

IMPORTANT

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Q.	Why is Ford proposing the recapitalization?
A.	Ford believes the recapitalization will provide value, flexibility, liquidity, and alignment for Ford stockholders, and tie Ford management even more closely to the interests of Ford stockholders. Ford believes that its stock is undervalued, limiting, among other things, the Company’s ability to use its stock for acquisitions or to attract, retain or incentivize employees. Ford believes the recapitalization will highlight its cash reserves and cash flow generating capacity, which have not been adequately reflected in its stock price. The recapitalization also will reshuffle ownership interests in the Company’s revised capital structure, as Ford stockholders elect to increase, maintain or reduce their relative equity investment in the Company. In particular, the recapitalization is responsive to the interests of stockholders who would ordinarily be disinclined to sell any portion of their existing Ford shares, and who are a source of strategic advantage to the Company. In addition, the recapitalization will tie Ford management’s compensation even more closely to the performance of Ford’s stock price.
Q.	Why is the recapitalization being accomplished through a merger and what is Ford Value Corporation?
A.	We have structured the recapitalization as a merger because this structure provides you with a choice to receive stock or a combination of cash and stock in the recapitalization. Ford Value Corporation is a corporation newly formed by Ford in order to facilitate the merger.
Q.	What do I need to do with the election and transmittal form?
A.	If you wish to make an election as to what you want to receive in the recapitalization, you must complete the election and transmittal form that you have received or will be receiving and tell us what you want. The different election alternatives are listed below. The election and transmittal form must be sent, together with your Ford stock certificates, to the exchange agent at one of the addresses below:

	In order for your election to be valid, the exchange agent must receive your validly completed election and transmittal form together with your Ford stock certificates by the start of the special meeting, which is scheduled for 8:30 a.m., eastern daylight savings time, on August 2, 2000.
	If you cannot send in your stock certificates by such time, you may send a notice of guaranteed delivery, with your completed election and transmittal form, promising to send in your actual certificates so that they are received by 5:00 p.m., eastern daylight savings time, on August 4, 2000 the second trading day after the special meeting, all in accordance with the instructions set forth under “The Recapitalization Agreement — Method of Making Elections.”

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	Please note that if you send your election by fax, you must use the guaranteed delivery procedure, and your stock certificates must be physically delivered by an “eligible institution” to the exchange agent (by hand, mail or by overnight delivery service) and must actually be received by the exchange agent by 5:00 p.m., eastern daylight savings time, on August 4, 2000 the second trading day after the date of the special meeting of stockholders. In addition, there are certain practical risks of attempting delivery by fax.
	If you hold shares in book entry form at EquiServe, you need not surrender stock certificates relating to such shares.

Q.	What elections can I make?
A.	There are three different elections available, for each share of Ford common stock or Class B stock:

	1.	$20 Cash Election.  You can elect to receive one share of new Ford common stock or new Class B stock (depending on the class of stock owned before the recapitalization) and $20 in cash.
	2.	New Stock Election.  You can elect to receive one share of new Ford common stock or new Class B stock (depending on the class of stock owned before the recapitalization) and a fraction of a share of new Ford common stock with a value of $20, calculated as described in this proxy statement.
	3.	Pro Rata Election.  You can elect to receive one share of new Ford common stock or new Class B stock (depending on the class of stock owned before the recapitalization) and a combination of cash and new Ford common stock with an aggregate value of $20, calculated as described in this proxy statement.

	If the average of the trading prices of Ford common stock during the five trading day period ending on July 28, 2000, which will be used in the calculations referred to above, is greater than $60, then the $20 in cash or value that you are to receive will be increased to $20 multiplied by a fraction, the numerator of which is the average of the Ford trading prices, and the denominator of which is $60.
	A NEW STOCK ELECTION WILL INCREASE YOUR PERCENTAGE OWNERSHIP INTEREST IN THE COMPANY, A PRO RATA ELECTION WILL MAINTAIN APPROXIMATELY 99% OF YOUR INTEREST IN THE COMPANY AND A $20 CASH ELECTION WILL FURTHER REDUCE YOUR OWNERSHIP INTEREST IN THE COMPANY. ANY ELECTION OTHER THAN A NEW STOCK ELECTION WILL HAVE THE SAME EFFECT AS IF YOU SOLD SOME OF YOUR SHARES FOR CASH.

Q.	How will Ford determine the fractions of a share of new Ford common stock to be received by stockholders of Ford pursuant to the elections described above?
A.	The fractions are generally determined pursuant to a formula based upon the excess of the average of the trading prices for Ford common stock during the five trading day period ending on July 28, 2000 over $20. For example, an election for $20 in new Ford common stock and an average of the trading prices of $60 would result in an additional 20 ÷ (60-20), or 1/2 share being received. Thus, in this example, Ford stockholders who make a new stock election would receive 1 1/2 shares of new Ford common stock (for each share of Ford common stock currently held) and 1 share of new Ford Class B stock plus 1/2 share of new Ford common stock (for each share of Ford Class B stock currently held).

	The calculations become more complicated, however, if the average of the trading prices during the five trading day period is greater than $60.

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Q:	How can I generally maintain my current ownership interest in the Company following the recapitalization?
A:	One way is to make a pro rata election. If you make a pro rata election, you will receive a number of shares of new common stock (or if you are currently a Class B stockholder, new common stock and Class B stock) and cash based upon a formula which is intended to result in you maintaining an ownership interest in the Company which is approximately 99% of your current ownership interest.

	If you make a new stock election, your percentage ownership will increase (unless all stockholders make such an election).

Q.	In the pro rata election, how much of the $20 will I receive in cash and how much in stock?
A.	The amount of cash and stock to be received will be determined based on a formula and will depend on several factors which will not be known until shortly after closing. For example, as noted in the previous answer, since the formula is generally intended to enable you to maintain an ownership percentage which is approximately 99% of your current ownership percentage, the actual allocation of the $20 between cash and stock will be affected by the relative number of shares as to which $20 cash and new stock elections are made, respectively.
Q:	What will Ford’s dividend policy be following the recapitalization?
A:	We currently intend to adjust our per share dividend so that a stockholder who elects all stock in the recapitalization (and, accordingly, will own a greater number of shares of new common or Class  B stock than he or she owns today) will, in the aggregate for the total number of shares received in the recapitalization for each share surrendered, receive approximately the same $.50 per share quarterly dividend that is currently paid. Stockholders who make either of the two cash elections will receive a reduced quarterly dividend following the recapitalization.
Q:	What should my U.S. federal income tax treatment be in the recapitalization?
A:	Subject to the assumptions and qualifications set forth under the heading “Certain U.S. Federal Income Tax Consequences of the Recapitalization,” in general:

	•	a stockholder who makes a $20 cash election or a pro rata election with respect to each share of his or her Ford common and Class B stock, and who has a relative stock interest in Ford of less than 1%, exercises no control over corporate affairs and does not constructively own any shares, or own any options to acquire shares, should recognize capital gain (but not loss) pursuant to the recapitalization to the extent of the lesser of any cash received or the gain realized by such stockholder;
	•	a stockholder who makes a new stock election with respect to each share of his or her Ford common and Class B stock should not recognize any gain or loss; and
	•	cash received by a stockholder pursuant to the recapitalization in certain other circumstances may be taxable as ordinary dividend income.

EACH STOCKHOLDER IS STRONGLY URGED TO CONSULT HIS OR HER TAX ADVISOR AS TO THE SPECIFIC TAX CONSEQUENCES TO SUCH STOCKHOLDER OF THE RECAPITALIZATION, INCLUDING THE APPLICATION OF FEDERAL, STATE, LOCAL AND FOREIGN INCOME AND OTHER TAX LAWS IN HIS OR HER PARTICULAR FACTS AND CIRCUMSTANCES.

Q:	What happens if stockholders elect to receive less than $10 billion in cash?
A:	If less than $10 billion in cash is elected, it is not expected that there will be any proration and all holders will be entitled to receive what they elected to receive.

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Q:	What happens if stockholders elect to receive more than $10 billion in cash?
A:	If stockholders making pro rata elections and $20 cash elections (including those failing to make elections) in the aggregate elect to receive more than $10 billion in cash, stockholders making $20 cash elections (including, those failing to make elections) will be subject to proration, and a portion of the consideration they requested in cash will instead be received in the form of new Ford common stock. However, such holders will be guaranteed to receive at least as much cash as stockholders making pro rata elections. Holders who elected to receive a pro rata portion of cash will not be subject to proration.
Q.	If I make a $20 cash election, will I be guaranteed to receive the full amount of the cash consideration I elected to receive?
A.	No. If Ford stockholders in the aggregate wish to receive more than $10 billion of cash in the recapitalization, the right to receive cash for holders who elected to receive $20 in cash for any share of common stock or Class B stock will be subject to proration as described above.
Q.	If I make a new stock election, will I be guaranteed to receive only stock in the recapitalization?
A.	Yes.
Q.	What happens if I do not return the election and transmittal form?
A.	If you fail to return the election and transmittal form and other documents on time, you will be deemed to have made an election to receive $20 in cash and one share of new common stock or new Class  B stock (depending on the class of stock owned before the recapitalization) for each of your Ford shares; however, failure to send in the election and transmittal form and related documents could delay your actual receipt of the recapitalization consideration. Promptly following the closing of the recapitalization EquiServe, the exchange agent, will mail a letter of transmittal to any stockholder of record as of the effective time of the recapitalization who has not returned an election and transmittal form. A stockholder who has not completed and returned the election and transmittal forms should complete and return the letter of transmittal received after the closing, together with his or her stock certificates, in order to receive the recapitalization consideration.
Q.	What if my broker holds my stock certificates for me in “street name” and cannot mail them in?
A.	In the event that your Ford shares are held in “street name,” your broker will provide you with instructions as to making an election.
Q.	Where can I get additional election and transmittal forms or other information?
A.	We have retained Georgeson Shareholder Communications Inc. as information agent to assist you in connection with the recapitalization. Persons in the United States and Canada may call Georgeson at (800) 243-7812 (toll free), persons outside the United States and Canada may call 00-44-207-335-7281 and banks, brokers and other financial institutions may call (212)  440-9800 (collect) to request additional documents and to ask any questions.

	We will provide you with information about the number of shares and the amount of cash that you will receive in the recapitalization, as follows:

	•	we will issue a press release at the time the average of the trading prices of Ford common stock is determined for election purposes;
	•	we will issue a press release at the time when the proration, if any, and the amount of cash paid pursuant to pro rata elections are determined; and
	•	shortly after the closing of the recapitalization, we will provide you with a statement indicating the number of shares and the amount of cash that you will receive.

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Q.	Can I revoke or change my election set forth on the election and transmittal form?
A.	Yes. You can revoke your original election by submitting a written notice of revocation to the exchange agent before the start of the special meeting, which is scheduled for 8:30 a.m., eastern daylight savings time, on August 2, 2000. Additionally, you may change your original election and make a new election by submitting a notice of revocation and by indicating on the written notice of revocation the new election choice that you wish to make. If you wish to submit a new election you should refer to the instructions and other materials that accompany the election and transmittal form.
Q.	Can I make partial elections?
A.	Yes. The election and transmittal form provides for an election to be made with respect to all or any portion of your Ford shares. You may make an election to receive any combination of the available options. Just complete and mail in the election and transmittal form together with your stock certificates so that you have made elections for all of your Ford shares. The $20 cash election is subject to proration.

	Please note that if you make a new stock election for some of the shares that you own and a different election for other shares that you own, you may cause any gain you recognize with respect to the cash you receive in the recapitalization to be taxed as ordinary dividend income rather than as capital gain.

Q.	What stockholder vote is required to approve the recapitalization?
A.	The recapitalization proposal must be approved by the holders entitled to cast a majority of the votes represented by the outstanding common stock and Class B stock voting together as a single class, as well as by the holders of a majority of the outstanding Class B stock voting separately. Class B stockholders, who in the aggregate have 40% of the voting power of the common stock and Class B stock taken together, have indicated that it is their intention to vote their shares in favor of the recapitalization proposal. The board of directors recommends that you vote FOR the recapitalization proposal.
Q.	How can I vote my shares?
A.	A stockholder of record can give a proxy to be voted at the special meeting either:

	•	over the telephone by calling a toll-free number;
	•	electronically, using the Internet; or
	•	by mailing the enclosed proxy card. We have provided a prepaid, self-addressed envelope for this purpose.
	•	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. You may also vote your shares by attending the special meeting and voting by ballot.

Q.	If my broker holds my shares in “street name,” will my broker vote my shares for me?
A.	Your shares will not be voted unless you follow the directions that your broker provides to you regarding how to vote your shares.

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Q.	Can I change my vote after I have mailed my signed proxy card or given a proxy by telephone or over the Internet?
A.	Yes. You can change your vote at any time before your proxy is voted at the special meeting. You can do this in one of three ways:

	•	by submitting written notice to Ford’s Secretary before the meeting that you have revoked your proxy;
	•	by submitting another proxy by telephone, via the Internet or by mail that is later dated and, if by mail, that is properly signed and mailed to:

	Ford Motor Company
	c/o EquiServe
	P.O. Box 8553
	Edison, New Jersey 08818-9420

or

	•	by voting in person at the special meeting.

Q.	What happens to my current Ford stock certificates if the recapitalization is terminated or delayed?
A.	If the recapitalization is terminated, the exchange agent will promptly return your Ford stock certificates. In the unlikely event that the recapitalization does not close shortly after the date it is approved at the special meeting, we expect to retain stock certificates, but we reserve the right, in order to facilitate continued orderly trading during the interim period between the special meeting and the closing of the recapitalization, to return to Ford stockholders that have made $20 cash elections the certificates representing shares of common stock or Class B stock.
Q.	Will I be sent new Ford stock certificates in the recapitalization?
A.	Not if you are a common stockholder. If the recapitalization is approved, the new Ford common stock to be received in the recapitalization will be represented only in book entry form and stock certificates will not be delivered to stockholders.

	A number of companies have adopted such a “certificateless” book entry system, whereby stockholders’ ownership and transfers are recorded on the books of the Company without the need for stockholders to physically hold or, if they wish to transfer or sell their stock, to deliver stock certificates.
	However, following the recapitalization, common stockholders will, if they so desire, be able to obtain physical certificates for their stock by following the instructions contained in the confirmation of book entry sent to them by the exchange agent.
	If the recapitalization is approved, holders of Class B stock (including any such holders who had not made an election) will be required to surrender their old Class B stock certificates in order to receive new certificates representing shares of new Class B stock.

Q.	When do you expect to complete the recapitalization?
A.	We are working toward completing the recapitalization as quickly as possible. We hope to complete the recapitalization on or shortly after August 2, 2000, the date of the special meeting. However, we cannot assure you as to when or if the recapitalization will occur.

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Q.	How are the terms of the shares of new Ford common stock and new Ford Class B stock different from the current Ford common stock and Class B stock?
A.	The differences are with respect to par value and rights upon liquidation. The new shares have a par value of $.01, rather than the par value today of $1.00. Upon liquidation, subject to the rights of any other class or series of stock having a preference on liquidation, each share of new common stock will be entitled to the first $.50 available for distribution to common and Class B stockholders, each share of new Class B stock will be entitled to the next $1.00 so available, each share of new common stock is entitled to the next $.50 available, and each share of new common stock and new Class B stock will be entitled to an equal amount thereafter. The current common stock and Class B stock share equally upon liquidation, regardless of the amount available for distribution to them, on a per share basis. We are also doubling the number of authorized shares of each such new class relative to the currently authorized amounts.
Q.	Where can I find more information about Ford?
A.	We file reports and other information with the SEC. You may read and copy this information at the SEC’s public reference facilities. Please call the SEC at 1-800-SEC-0330 for information about these facilities. This information is also available on the SEC’s World Wide Web site at http://www.sec.gov and at the offices of the New York Stock Exchange. You can also request copies of these documents from us.
Q.	Who can answer my questions?
A.	You may contact our information agent at:

	Georgeson Shareholder Communications Inc.
	17 State Street
	New York, NY 10004
	(800) 243-7812 (U.S. and Canada)
	00-44-207-335-7281 (outside of the U.S. and Canada)
	(212) 440-9800 (collect) (banks, brokers and other financial institutions)
	8:00 a.m. to 8:00 p.m. Monday through Friday (eastern daylight savings time)
	12:00 p.m. to 6:00 p.m. Saturday (eastern daylight savings time)

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      This summary highlights selected information from this document. It does not contain all of the information that is important to you and is qualified by the more detailed information contained throughout the rest of this document. We urge you to read carefully the entire document and the other documents referred to in this document to fully understand the recapitalization.

The Recapitalization (page 24)

      As a result of the recapitalization, each current stockholder of Ford will have the right to make one of the following three elections to receive, in exchange for each share of common stock or Class B stock owned by such stockholder: (1) one share of a new class of common stock or Class B stock (depending on the class of stock owned before the recapitalization) and $20 in cash; (2) one share of a new class of common stock or Class B stock (depending on the class of stock owned before the recapitalization) and a fraction of a share of a new class of common stock with a value of $20, calculated as provided in this proxy statement; or (3) one share of a new class of common stock or Class B stock (depending on the class of stock owned before the recapitalization) and a combination of cash and new common stock with an aggregate value of $20, calculated pursuant to a formula intended to result in the percentage stock ownership of a stockholder electing this alternative being approximately 99% of his or her ownership percentage before the recapitalization. The $20 amount in cash or value that you are to receive will be increased if the average of the trading prices of Ford common stock during a five trading day period ending on July 28, 2000 is greater than $60.

      Holders failing to make elections will be treated as if they made the first of the three elections above. Elections to receive $20 in cash (including, to the extent applicable, non-elections) will be subject to proration, as only $10 billion (less any applicable reserve established for payments to stockholders, if any, seeking to exercise appraisal rights) in cash is generally available for distribution to stockholders. See “The Recapitalization.”

      Class B stockholders have indicated that it is their intention to make new stock elections with respect to their shares of common stock and Class B stock. In addition, we expect our executive officers will generally make new stock elections with respect to their shares of common stock.

The Company (page 22)

	Ford Motor Company One American Road Dearborn, Michigan 48126 (313) 322-3000 www.ford.com

      We incorporated in Delaware in 1919 and acquired the business of a Michigan company, also known as Ford Motor Company, incorporated in 1903 to produce and sell automobiles designed and engineered by Henry Ford. We are the world’s largest producer of trucks and the second-largest producer of cars and trucks combined.

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      Our business is divided into two business sectors, and, after giving effect to our spin-off of our wholly-owned subsidiary, Visteon Corporation, we manage these sectors as three primary operating segments. These business sectors and operating segments are described below.

Certain U.S. Federal Income Tax Consequences of the Recapitalization (page 38)

      In the opinion of Skadden, Arps, Slate, Meagher & Flom LLP, which is based upon representations of the Company, the recapitalization should constitute a “recapitalization” of the Company within the meaning of Section 368(a)(1)(E) of the Internal Revenue Code. In general, for U.S. federal income tax purposes, (i) a stockholder who exchanges each share of such stockholder’s stock for a combination of cash and new stock should recognize capital gain (but not loss) to the extent of the lesser of the cash received or the gain realized by such stockholder in the exchange, provided that such stockholder exercises no control over corporate affairs, has a minimal interest in the Company (an interest of less than 1% should satisfy this requirement), does not constructively own any shares and does not own any options to acquire any shares and (ii) a stockholder who exchanges all of such stockholder’s stock solely for new stock should not recognize gain or loss. However, the U.S. federal income tax consequences for a particular stockholder will depend upon such stockholder’s particular facts and circumstances and, in certain cases, cash received pursuant to the recapitalization may be taxable as ordinary dividend income. For individual taxpayers, long-term capital gains are generally subject to tax at a maximum U.S. federal income tax rate of 20%, while ordinary dividend income may be subject to tax at a maximum U.S. federal income tax rate of 39.6%. In addition, the deductibility of capital losses is subject to limitations for both individuals and corporations. Because the tax consequences of the elections will depend upon each stockholder’s individual facts and circumstances, stockholders should consult their tax advisors for a full understanding of the tax consequences to them of the recapitalization and the elections available to them.

Appraisal Rights for Dissenting Stockholders (page 36)

      Although holders of Class B stock, which is not listed on any stock exchange, are entitled to appraisal rights in connection with the recapitalization, the Company does not believe that holders of common stock are entitled to appraisal rights by virtue of the recapitalization because the common stock is listed on the New York Stock Exchange and any holder of common stock can elect to receive all new common stock in the recapitalization. If, however, appraisal rights are available, stockholders who do not vote for the recapitalization proposal and who dissent by complying with the procedures required by the Delaware General Corporation Law will have the right to receive, instead of the consideration paid in the recapitalization, payment for the fair value of their shares as of the effective date of the recapitalization, as determined by the Delaware Court of Chancery. The Company reserves the right to request a court ruling that stockholders are not entitled to appraisal rights by reason of the recapitalization in the event that appraisal rights are requested. See “The Recapitalization — Appraisal Rights.”

Per Share Market Price Information (page 50)

      Shares of Ford common stock are listed on the New York Stock Exchange under the symbol “F,” as well as on a number of foreign exchanges. The closing price of Ford common stock on

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      As of June 27, 2000, there were 1,134,000,007 shares of Ford common stock and 70,852,076 shares of Ford Class B stock outstanding and employee stock options to purchase 87,855,753 shares of Ford common stock outstanding.

Votes Required; Record Date for Voting (page 19)

      You can vote at the special meeting if you owned shares of Ford common stock or Class B stock at the close of business on June 27, 2000, the record date. Holders of common stock have 60% of the general voting power, and holders of Class B stock have the remaining 40% of the general voting power. Each stockholder has one vote for each share of common stock and, based on shares outstanding on June 27, 2000, 10.670 votes for each share of Class B stock.

      Approval of the recapitalization proposal requires:

	•	the affirmative vote of the holders entitled to cast a majority of the votes represented by the outstanding shares of Ford common stock and Class B stock voting together as a single class; and
	•	the affirmative vote of the holders of a majority of the outstanding shares of Class B stock.

      If you do not vote your shares, the effect will be a vote against the recapitalization.

      Class B stockholders have indicated that it is their intention to vote their shares of Class B stock in favor of the recapitalization.

Recommendation of Ford Board of Directors

      The board of directors of Ford approved the recapitalization agreement and plan of merger at a meeting held on June 27, 2000. In connection with this approval, the Board received a written opinion of J.P. Morgan Securities Inc. (attached as Appendix C hereto). The board of directors recommends that you vote FOR the recapitalization proposal.

Interests of Certain Persons in the Recapitalization (page 32)

      Class B stockholders have indicated that they intend to elect to receive only stock in the recapitalization. We also expect that our executive officers will generally make new stock elections with respect to their shares of common stock. In addition, a number of such persons own employee stock options. As a result, Class B stockholders’ and executive officers’ proportionate ownership interest in the Company may increase in the recapitalization, depending on the number of elections by other stockholders to receive a portion of the exchange consideration in cash. However, it should be noted that all stockholders will have the right to make new stock elections. The aggregate voting power of the Class B stockholders will increase by reason of the receipt of new common stock. Additionally, the recapitalization will have the effect of providing liquidity to Class B stockholders without reducing the number, or the aggregate voting power, of their Class B shares.

Employee Stock Options (page 35)

      Outstanding employee options to buy shares of Ford common stock generally will be adjusted, resulting in options to purchase an increased number of shares of new common stock generally determined by multiplying the number of shares subject to an option by the sum of one and a fraction, the numerator of which is $20, and the denominator of which is (the lesser of $60 and the average price of Ford common stock) minus $20, at an exercise price generally determined by dividing the exercise price of an option by the sum referred to above.

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Completion of the Recapitalization (page 55)

      Before we can complete the recapitalization, we must satisfy a number of conditions. These conditions include, but are not limited to, the following:

	•	the approval of the recapitalization agreement and the merger by Ford stockholders;
	•	the absence of any legal prohibitions against the recapitalization; and
	•	new stock elections shall have been validly made (and not revoked or lost) with respect to a number of shares of common stock and Class B stock such that stockholders electing to receive cash, whether pursuant to a pro rata election or a $20 cash election, with respect to each of their shares will undergo a reduction of interest in Ford of at least one percent as compared to their interest in Ford immediately before the recapitalization.

      We will complete the recapitalization shortly after all of the conditions to the recapitalization have been satisfied or waived. We expect to complete the recapitalization on or shortly after August 2, 2000 the date of the special meeting to approve the recapitalization.

Termination and Amendment of the Recapitalization Agreement (page 55)

      The board of directors of Ford may terminate the recapitalization at any time before the closing of the recapitalization if it determines that it is appropriate to do so, including by reason of the number of dissenting shares. To the fullest extent permitted by law, the board of directors of Ford and its wholly-owned subsidiary, Ford Value Corporation, by mutual consent, may amend the recapitalization agreement and plan of merger at any time before the closing of the recapitalization.

Listing of Ford Common Stock (page 36)

      The shares of new Ford common stock to be issued in the recapitalization will be listed on the New York Stock Exchange under the ticker symbol “F.”

Comparison of Rights of Ford Stockholders Before and After the Recapitalization (page 59)

      After the recapitalization, Ford stockholders who receive any new common stock or new Class B stock for their current Ford shares will continue to have substantially the same rights as they had as Ford stockholders before the recapitalization, except as to certain preferences with respect to the first $2.00 per share to be paid to common and Class B stockholders upon liquidation.

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Summary Historical and Pro Forma Financial Data of Ford

      Selected Historical Financial Data.  The following tables set forth selected financial data and other data concerning Ford for each respective period. The consolidated statement of income data set forth below for each of the three years in the period ended December 31, 1999, and the consolidated balance sheet data set forth below as of December 31, 1999 and 1998, are derived from audited consolidated financial statements incorporated by reference in this document. The consolidated statement of income data set forth below for each of the two years in the period ended December 31, 1996, and the consolidated balance sheet data set forth below as of December 31, 1997, 1996 and 1995, are derived from audited consolidated financial statements not included in this document. The results of operations for each of the five years in the period ended December 31, 1999 have not been restated to reflect Visteon as a discontinued operation. The data for the three-month periods ended and as of March 31, 2000 and 1999, are derived from interim consolidated financial statements not included in this document, which in our opinion include all adjustments necessary for a fair presentation of the results for those periods. The results of operations for the three-month periods ended March 31, 2000 and 1999 and the balance sheet data as of March 31, 2000 have been adjusted to present Visteon as a discontinued operation. Results for the three months ended March 31, 2000 are not necessarily indicative of results that may be expected for the full year. The information is only a summary and you should read it together with the consolidated financial statements of Ford, the pro forma financial statements of Ford and the other information about Ford included elsewhere in, or incorporated by reference in, this document.

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      The following tables set forth selected financial data and other data concerning Ford:

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      Selected Pro Forma Financial Data. The following table presents summary selected unaudited pro forma statements of income and other financial data of Ford. The information is presented as if the spin-off of Visteon and the recapitalization had occurred as of January 1, 1999 for the income statement data and as of March 31, 2000 for the balance sheet data. The unaudited pro forma data were derived from the application of pro forma adjustments and to give effect to the estimated effects of:

	•	the spin-off of Ford’s wholly owned subsidiary, Visteon Corporation, which occurred on June 28, 2000, including the transfer to Visteon of the assets and liabilities comprising Ford’s automotive components and systems business; and
	•	the recapitalization, on the basis of various assumptions, including the payment of $10 billion in cash, and $50.5785 per share as the average of the trading prices of Ford common stock during a five trading day measurement period.

      The information is only a summary and you should read it together with the consolidated financial statements of Ford, the pro forma financial statements of Ford and the other information about Ford included elsewhere in, or incorporated by reference in, this document.

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from continuing operations would be $3.72 and $3.64, respectively. Assuming shareholders elect to receive only $5 billion in cash (and a Ford share price of $50.5785), pro forma income from continuing operations would be $6,718  million, pro forma shares outstanding would be 1,831 million shares, and pro forma basic and diluted income per share from continuing operations would be $3.66 and $3.58, respectively.

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Pro Forma Balance Sheet Data

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      You should consider the following matters in deciding whether to vote in favor of the recapitalization. You should also consider the other information included and incorporated by reference in this document.

The trading price of the new Ford common stock that you will receive in the recapitalization, and the price of the Ford common stock immediately before the closing, may each be different than the price used in the election calculations and the price when you made your elections.

      The valuation period will occur during the five trading day period ending July 28, 2000, three trading days before the termination of the election period and the special meeting. The volume-weighted average of the volume-weighted average trading prices of Ford common stock during such five day period will, unless it exceeds $60 per share, be used to determine the number of shares of new common stock consideration to be received by you in the recapitalization if you made a new stock election or pro rata election. As a result, the trading price of such new common stock to be received by you may, at the time of closing and at the time new shares are credited to your account, be greater or less than the value, determined on the basis of the price used in the election calculations and the price when you made your election. Similarly, if you made a pro rata or $20 cash election, the amount of cash you will receive may be greater or less than the amount you would have received had it been based upon the closing sale price of Ford common stock immediately before the recapitalization, and greater or less than the value of the other election alternatives, valued at the time the cash is actually distributed to you.

You may not receive as much cash as you have elected.

      Stockholders electing to receive $20 in cash in the recapitalization may not receive as much cash as they elected to receive, as such elections are limited by the fact that only $10 billion in cash is available for distribution. In the event that more than $10 billion (less any applicable reserve established for payments to stockholders, if any, seeking to exercise appraisal rights) in cash is elected to be received by stockholders in the recapitalization (including cash that is deemed to be elected by stockholders who fail to make an election), stockholders who made elections to receive $20 in cash shall be subject to proration and will receive stock in lieu of some of the cash which they elected to receive.

After the recapitalization, Ford will have less cash available to it.

      After the recapitalization, Ford will have less cash, cash equivalents and marketable securities, and, on a pro forma basis, assuming $10 billion in cash is paid in the recapitalization, as of March 31, 2000, its stockholders’ equity will be reduced by $10 billion and the percentage of total capitalization (defined to be the sum of stockholders’ equity plus automotive debt) represented by automotive debt will increase from 30%, after giving effect to the spin-off of Visteon but not the recapitalization, to 41%, after giving effect to both the Visteon spin-off and the recapitalization. The industry in which we operate is a cash-intensive business and it is therefore necessary for Ford to maintain adequate cash on hand, including for use in the event of an industry downturn. While we believe that the amount of cash, cash equivalents and marketable securities that will remain available will be sufficient, we cannot provide complete assurance that this will be the case in all circumstances, including in the event of such a downturn.

The recapitalization will provide liquidity to Class B stockholders without reducing their aggregate level of ownership of the Class B stock or the aggregate voting power of the Class B stock.

      The recapitalization will provide liquidity to Class B stockholders either currently through the receipt of cash or, in the future, through subsequent sales of new common stock received in the

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The voting power of holders of Class B stock who make new stock elections will increase.

      Since the aggregate vote of all shares of common stock is fixed at 60% of the total voting power of the common stock and Class B stock taken together, the issuance of new common stock to holders of Class B stock will permit them to cast a portion of such 60% of the vote, in addition to the 40% of the vote they will remain able to cast by reason of their ownership of Class B stock. Moreover, the recapitalization will increase the total number of shares of new common stock outstanding relative to the number of shares of common stock outstanding before the recapitalization. This will have the effect of reducing the voting power of each share of new common stock relative to the existing common stock. As a result, the proportionate increase in voting power of a common stockholder who elects all stock will be less than the proportionate increase in voting power of a Class B stockholder who elects all stock.

Even if the amount of the $20 payment is increased, the total consideration to be received in the recapitalization by a stockholder will remain unchanged.

      If the average of the trading prices of Ford common stock during the five trading day period exceeds $60, then the $20 payments (in cash or stock or both) will be increased. This, however, will result in a corresponding decrease in the per share value of the new Ford common stock and new Class B stock resulting from the increased number of shares issued or, subject to the $10 billion limit, cash paid in the recapitalization. Accordingly, if the average trading price exceeds $60, the aggregate value received by a stockholder will not change, even though, subject to proration, the amount to be received in cash will be increased.

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      The matters to be considered at the special meeting are of great importance to Ford stockholders. Accordingly, stockholders are urged to read carefully and consider the information presented in this proxy statement and its attachments. Stockholders are also urged to give a proxy to be voted at the special 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.

Date, Place and Time

      The special meeting is scheduled to be held at The Playhouse Theatre, DuPont Building, 10th and Market Streets, Wilmington, Delaware, on August 2, 2000 at 8:30 a.m., eastern daylight savings time.

Purpose of the Special Meeting

      The purpose of the special meeting is to consider and take action upon the recapitalization agreement and plan of merger, dated June 27, 2000, between Ford Motor Company and Ford Value Corporation, a wholly owned subsidiary of Ford Motor Company, and such other matters as may be appropriate for consideration at the special meeting.

Record Date; Stock Entitled to Vote; Quorum

      Owners of record of shares of Ford common stock and Ford Class B stock on the close of business on June 27, 2000, the record date for the special meeting, are entitled to receive notice of and vote at the special meeting. In addition, notice of the special meeting will be sent to holders of depositary shares representing Ford Series B preferred stock, although they will not be entitled to vote at the special meeting with respect to their depositary shares representing Series B preferred stock. On the record date, 1,134,000,007 shares of Ford common stock and 70,852,076 shares of Ford Class B stock were issued and outstanding and entitled to vote at the special meeting. Each stockholder has one vote for each share of common stock and 10.670 votes for each share of Class B stock held by such stockholder.

      A quorum of stockholders is necessary for a valid meeting. The required quorum for the transaction of business at the special meeting is a majority of the total voting power of all the outstanding shares of stock entitled to vote on the record date. Abstentions and broker non-votes each will be included in determining the number of shares present at the special meeting for the purpose of determining the presence of a quorum. Because Ford is seeking the affirmative vote of the holders entitled to cast a majority of the votes represented by the outstanding shares of Ford common stock and Class B stock voting together as a single class and holders of a majority of the outstanding shares of Ford Class B stock voting as a separate class to adopt the recapitalization proposal, abstentions and broker non-votes will have the same effect as votes against such matters.

      A broker non-vote occurs when a broker is not permitted to vote on a matter without instructions from the beneficial owner of the shares and no instruction is given. Under New York Stock Exchange rules, if your broker holds your shares in its name, your broker may not vote your shares on the recapitalization proposal absent instructions from you. Therefore, without your voting instructions, a broker non-vote will occur.

Vote Required

      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. The affirmative vote of holders entitled to cast a majority of the votes represented by the outstanding shares of common stock and Class B stock voting together as a single class, and the affirmative vote of holders of a majority of the shares of Class B stock voting separately as a class is required to approve and adopt the recapitalization

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      Class B stockholders have indicated that it is their intention to vote their shares of Class B stock in favor of the recapitalization agreement.

Voting of Proxies

      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 special meeting, we will vote your shares as you direct.

      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 in favor of the recapitalization.

Revocation of Proxies

      You can revoke your proxy at any time before it is exercised at the special meeting in any of three ways:

	•	by submitting written notice to Ford’s Secretary before the meeting that you have revoked your proxy;
	•	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
	•	by voting in person at the special meeting.

Expenses of Solicitation

      All costs of soliciting proxies, including reimbursement of fees of certain brokers, fiduciaries and nominees in obtaining voting instructions from beneficial owners, will be paid by Ford. In addition, Ford has retained Georgeson Shareholder Communications Inc. to assist in the distribution and solicitation of proxies and will pay Georgeson a fee estimated not to exceed $250,000, plus $1.05 per minute per telephone call, plus reimbursement of reasonable expenses.

Other Matters to be Acted on at the Meeting

      Adoption of the recapitalization agreement and plan of merger is the only matter to be presented or acted upon at the special meeting. Under our by-laws, no business other than that stated in the meeting notice may be transacted at any meeting of stockholders. If any procedural matter is presented at the meeting on which a vote may be properly taken, the shares represented by proxies will be voted in accordance with the judgment of the person or persons voting those shares.

      The action proposed in this proxy statement is not a matter that can be voted on by brokers holding shares for beneficial owners without the owner’s specific instructions. Accordingly, all beneficial owners of Ford stock are urged to return the enclosed proxy card marked to indicate their votes or to contact their brokers to determine how to vote.

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How to Vote Your Proxy and Make an Election

      Stockholders should NOT send any stock certificates with their proxy cards. However, election and transmittal forms must be accompanied by stock certificates or by notices of guaranteed delivery.

You should mail your signed proxy card in the enclosed small, white, prepaid, self-addressed return envelope marked “Proxy”, or you may cast your vote by telephone or through the Internet following the instructions on the proxy card.

The enclosed election and transmittal forms, which must be accompanied by either stock certificates or by notice of guaranteed delivery, should be returned to EquiServe in the enclosed large, prepaid return envelope. Holders of common stock should use the enclosed brown-kraft envelope, while holders of Class B stock should use the enclosed green-striped envelope. The address that you should send your form of election to will depend on the method of delivery that you choose. The available options and relevant addresses for EquiServe are listed on page 1 of this proxy statement/ prospectus.

How to Attend the Special Meeting

      Stockholders of Record. When you provide your proxy, please let us know if you plan to attend the special meeting. If you plan to attend, the bottom half of your proxy card is a ticket that will admit the named stockholder(s) and one guest. If you lose your ticket, we can issue you a ticket at the door. (Please bring proof of ownership, such as a dividend check stub, book entry account statement or account number.)

      “Street Name” Holders.  Tell your broker that you are planning to attend the special meeting and would like a “legal proxy.” Then simply bring that form to the special meeting, and we will give you a ticket at the door that will admit you and one guest. If you cannot 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.

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General

      Ford Motor Company was incorporated in Delaware in 1919. We acquired the business of a Michigan company, also known as Ford Motor Company, incorporated in 1903 to produce and sell automobiles designed and engineered by Henry Ford. We are the world’s largest producer of trucks and the second-largest producer of cars and trucks combined. We and our subsidiaries also engage in other businesses, including financing and renting vehicles and equipment.

      Ford’s business is divided into two business sectors, and, after giving effect to the spin-off of our wholly-owned subsidiary, Visteon Corporation, we manage these sectors as three primary operating segments. These business sectors and operating segments are described below.

Recent Developments

      Visteon Spin-off. On June 28, 2000, we completed our spin-off of Visteon Corporation, which was our wholly-owned subsidiary that owned and operated our automotive components and systems businesses. In the spin-off, we distributed all of our shares of Visteon Corporation common stock on a pro rata basis to the holders of record on June 12, 2000 of Ford common stock and Class B stock.

      European Restructuring. On May 12, 2000, we announced a major restructuring of our European automotive operations to improve our profitability and growth in the region. The restructuring action is based on a study that concluded that we have the equivalent of one full plant’s capacity more than we need in Europe. In 1999 Ford of Europe had the capacity to build 2.2 million vehicles, but sold only 1.65 million. We do not expect to sell in excess of two million vehicles a year in Europe over the short to medium term. As a result, among other things, the restructuring actions planned include:

	•	Cessation of vehicle assembly and major body construction at our Dagenham facility in England by the first quarter of 2002.
	•	An employee separation program for about 1,900 employees at the Dagenham facility, partially offset by about 500 incremental jobs associated with the expansion of diesel engine production and engineering elsewhere at the Dagenham facility.
	•	A 50-50 joint venture company to be formed with Getrag, a German transmission specialist, to engineer and manufacture manual transmissions at Ford’s facilities at Bordeaux in France, Cologne in Germany and Halewood in Britain, which facilities will be owned by the joint venture.

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      Land Rover Acquisition. On May 24, 2000, we announced that we signed a definitive agreement to buy the Land Rover sport utility vehicle business from BMW AG for three billion euros (equivalent to approximately $2.74 billion at May 24, 2000). Two-thirds of the purchase price will be paid at closing, and the remainder will be paid in 2005. The purchase includes the Land Rover plant in Solihull, England, the Land Rover dealer network, a research and development center in Gaydon, England, the British Industry Heritage Centre, and responsibility for approximately 13,000 employees. We will acquire the entire line of Land Rover vehicles, including the Range Rover, Discovery, Defender, and Freelander models. BMW will continue to supply some parts, including engines, to Land Rover. The acquisition does not include the Rover passenger car business or assumption of any debt by Ford. The transaction is expected to close on June 30, 2000.

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General

      Elections and Exchange Consideration. At the effective time of the recapitalization, each outstanding share of Ford common stock and Class B stock will, at the election of the holder, be converted into the right to receive one of the following:

	•	$20 Cash Election — Stockholders may elect to receive one share of new Ford common stock or new Class B stock (depending on the class of stock owned before the recapitalization) and $20 in cash.

However, if the average of the trading prices of Ford common stock during the five trading day period ending on July 28, 2000 is greater than $60, then the $20 cash election distribution will be increased in the manner discussed in Appendix B to an amount equal to $20 multiplied by a fraction, the numerator of which is such average of the trading prices of Ford common stock and the denominator of which is $60.

The amount of cash paid may be subject to proration (described below).

	•	New Stock Election — Stockholders may elect to receive one share of new Ford common stock or new Class B stock (depending on the class of stock owned before the recapitalization) and a fraction of a share of new common stock. Such fraction will be equal to the quotient obtained by dividing $20 by the excess of (i) the lesser of such average Ford trading price and $60 over (ii) $20. This will result in the new stock elector receiving a fraction of a share of new common stock which will have the same calculated post-closing trading value as the cash to be received by a $20 cash elector, as described above.

Example: Assuming the average price of Ford common stock is $60, a stockholder who makes an all stock election would receive one share of either new common stock or new Class B stock (depending on the class of stock owned before the recapitalization) and $20 worth of new common stock, or 20 ÷ (60 - 20) = 1/2, of a share of new common stock.

	•	Pro Rata Election — Stockholders may elect to receive a combination of cash and stock. The amount of stock, which will be equal to one share of new common stock or Class B stock (depending on the class of stock owned before the recapitalization) plus a fraction of a share of new common stock, is designed to allow each stockholder to maintain an ownership interest in the Company which is approximately 99% of such stockholder’s ownership interest immediately before the recapitalization. The balance of the $20 (or, if the average of the trading prices of Ford common stock is greater than $60, $20 multiplied by a fraction, the numerator of which is such average of the trading prices of Ford common stock and the denominator of which is $60) will be received in cash.

The portion of the $20 recapitalization consideration to be received in the form of stock (and, accordingly, the portion to be received in cash) will depend, among other things, on the elections made by other stockholders. Thus, it will not be possible for a person making a pro rata election to know, at the time of making the election, the precise mix of consideration to be received.

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Example: Assuming that $10 billion in cash has been elected by $20 cash electors, there are no dissenting shares, the average price of Ford stock is $60, and there are 1.205 billion shares of common stock and Class B stock outstanding, then pro rata electors would receive for each share (1) one share of new common stock or new Class B stock (depending on the class of stock owned before the recapitalization), (2) approximately $8.82 in cash, and (3) approximately .2795 of a share of new common stock.

Example: Assuming the same facts as above except that only $9 billion in cash is elected by $20 cash electors and there are 50 million shares subject to pro rata elections, then pro rata electors would receive for each share (1) one share of new common stock or new Class B stock (depending on the class of stock owned before the recapitalization), (2) approximately $8.34 in cash and (3) approximately .2915 of a share of new common stock.

      The average of the trading prices of Ford common stock for purposes of the election calculations will be determined on the basis of the volume-weighted average of the daily volume-weighted average trading price of Ford common stock (traded regular way, as reported on the New York Stock Exchange Composite Tape) on each day in the five trading day period ending on July 28, 2000.

      Appendix B sets forth the formulas to be used in calculating the amounts payable pursuant to the various elections discussed above, and the foregoing discussion is subject to this Appendix and to the recapitalization agreement and plan of merger attached as Appendix A.

      Non-Electing Stockholders. Stockholders who do not make an election (i.e., stockholders who do not return a properly completed form of election) will be treated as if they made a $20 cash election.

      Proration. The amount of cash to be distributed in the recapitalization is not intended to exceed approximately $10 billion. In the event that an amount of cash in excess of $10 billion is elected by stockholders making $20 cash elections (including stockholders who do not make elections) and pro rata elections, then the cash will be distributed in the manner described below. These proration provisions will reduce the amount of cash that would otherwise be distributed to stockholders making $20 cash elections (including non-electing stockholders). In no event, however, will an amount less than the cash pro rata amount be paid to any such person or to any person making a pro rata election.

	First — Shares for which pro rata elections and $20 cash elections (including non-electing shares) are made will each receive the amount of cash payable pursuant to pro rata elections as described under “Election and Exchange Consideration — Pro Rata Election”;
	Second — Shares for which $20 cash elections (including non-electing shares, as described above) are made will each receive, to the extent available, equal amounts of cash until such shares shall have each received $20 in cash or, if the average of the trading prices of Ford common stock is greater than $60, $20 multiplied by the average of the trading prices of Ford common stock and divided by $60.

      We have the right to reserve out of the $10 billion otherwise available for distribution, an amount not to exceed the average of the trading prices of Ford common stock, for each share as to which the holder, as of the time when the foregoing calculations are made, has complied with all

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      To the extent the amount of cash received by a stockholder who made a $20 cash election or no election is reduced by reason of the proration provisions described above, such stockholder will instead receive an additional fraction of a share of stock, as calculated as set forth in Appendix B.

      All shares and fractions of a share received by holders of common stock will be in the form of shares of new Ford common stock. Holders of Class B stock will receive, for each such share, one share of new Class B stock; any excess shares received will be in the form of new Ford common stock.

      You are urged to refer to the recapitalization agreement and plan of merger for details of the recapitalization and the terms and conditions of the recapitalization agreement and plan of merger. We have attached a copy of the recapitalization agreement and plan of merger to this document as Appendix A. See also “The Recapitalization Agreement” for a discussion of certain provisions not summarized above. The actual formulas to be used in proration calculations are set forth on Appendix B to which the foregoing discussion is subject.

Reasons for the Recapitalization; Structure of the Recapitalization

      Ford believes the recapitalization will provide value, flexibility, liquidity, and alignment for Ford stockholders, and tie Ford management even more closely to the interests of Ford stockholders. Ford believes that its stock is undervalued, limiting, among other things, the Company’s ability to use its stock for acquisitions or to attract, retain or incentivize employees. Ford believes the recapitalization will highlight its cash reserves and cash flow generating capacity, which have not been adequately reflected in its stock price.

      The recapitalization also will reshuffle ownership interests in the Company’s revised capital structure, as Ford stockholders elect to increase or reduce their relative equity investment in the Company. Moreover, in Ford’s judgment, certain objectives in the recapitalization, such as stockholder liquidity, could not be achieved as effectively through a conventional share repurchase. In particular, the recapitalization is responsive to the interests of stockholders who would ordinarily be disinclined to sell any portion of their existing Ford shares. The commitment to Ford of these long-term stockholders, which include current and retired employees, holders of Class B stock, and certain retail and institutional investors, is a source of strategic advantage to the Company. Finally, by allowing for the distribution of additional new common shares to holders of Class B stock, the recapitalization will more closely align the interests of all Ford stockholders.

      Executive officers of Ford generally are expected to elect to receive only stock in the recapitalization. More broadly, Ford’s employee stock option and restricted stock programs will be adjusted to reflect the issuance of new shares in the recapitalization. As a consequence of the executive elections and the adjustments in the employee incentive plans, the recapitalization will tie Ford management’s compensation even more closely to the performance of Ford’s stock price.

      Our board of directors approved the recapitalization in principle on April 13, 2000. Goldman, Sachs & Co. acted as financial advisor to the Company in connection with the recapitalization and assisted it in developing the terms of the recapitalization. The Company has agreed to pay Goldman, Sachs & Co. a fee for its services and to indemnify it against certain liabilities, including those under the federal securities laws. At a meeting held on June 27, 2000, our board of directors, with ten of the thirteen directors present, unanimously approved the detailed terms of the recapitalization and

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      The recapitalization has been structured as a merger pursuant to which Ford Value Corporation will merge into Ford, with Ford continuing as the surviving corporation. The recapitalization has been structured as a merger to facilitate the ability of Ford stockholders to elect from different consideration alternatives.

Opinion of J.P. Morgan

      Ford retained J.P. Morgan to deliver a fairness opinion in connection with the recapitalization. No limitations were imposed upon J.P. Morgan by our board of directors with respect to the investigations made or procedures followed by J.P. Morgan in rendering its opinion.

      At the meeting of our board of directors on June 27, 2000, J.P. Morgan rendered its written opinion to our board that, as of that date and on the basis of and subject to the matters described in the opinion, the consideration to be received by the holders of Ford common stock in the recapitalization was fair, from a financial point of view, to such holders.

      The full text of the written opinion of J.P. Morgan dated June 27, 2000, which sets forth the assumptions made, matters considered and limits on the review undertaken, is attached as Appendix C to this proxy statement. We urge you to read the opinion in its entirety.

      J.P. Morgan’s opinion is addressed to our board of directors, is directed only to the consideration to be received by stockholders of Ford in the recapitalization and does not constitute a recommendation to any stockholder of Ford as to how to vote with respect to the recapitalization or what form of consideration to elect in the recapitalization.

      In arriving at its opinion, J.P. Morgan reviewed, among other things:

	•	a proof dated June 23, 2000 of this proxy statement including therein a draft of the recapitalization agreement;
	•	certain publicly available information concerning the business of Ford and of certain other companies engaged in businesses comparable to those of Ford, and the reported trading and volume history and market prices for certain other companies’ securities deemed comparable;
	•	the terms of Ford common stock, Ford Class B stock, the new Ford common stock and the new Ford Class B stock included in the Restated Certificate of Incorporation of Ford and in the recapitalization agreement;
	•	current and historical market prices of Ford common stock;
	•	the audited financial statements of Ford for the fiscal year ended December 31, 1999 and the unaudited financial statements of Ford for the period ended March 31, 2000; and
	•	certain internal financial analyses and forecasts prepared by the management of Ford.

      J.P. Morgan also analyzed the potential impact of the recapitalization on the economic and voting interests of the holders of Ford common stock and Class B stock. In addition, J.P. Morgan held discussions with certain members of the management of Ford with respect to the recapitalization, the past and current business operations of Ford, the financial condition and future prospects and operations of Ford, the effects of the recapitalization on the financial condition and future prospects and operations of Ford and certain other matters that J.P. Morgan believed necessary or

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      J.P. Morgan relied upon and assumed, without independent verification, the accuracy and completeness of all information that was publicly available or was furnished to J.P. Morgan by Ford or otherwise reviewed by J.P. Morgan. J.P. Morgan does not assume any responsibility or liability for that information or its accuracy. J.P. Morgan did not conduct any valuation or appraisal of any assets or liabilities, and valuations and appraisals were not provided to J.P. Morgan. In relying on financial analyses and forecasts provided to it, J.P. Morgan assumed that they had been reasonably prepared based on assumptions reflecting the best currently available estimates and judgments by management as to the expected future results of operations and financial condition of Ford to which those analyses or forecasts relate. J.P. Morgan assumed that the recapitalization will have the tax consequences described in this proxy statement, and in discussions with, and materials furnished to J.P. Morgan by, representatives of Ford, and that the transactions contemplated by the recapitalization agreement will be consummated as described in the recapitalization agreement and this proxy statement. J.P. Morgan also assumed that all of the holders of Class B stock will elect to receive one share of new Ford Class B stock plus a fraction of a share of new Ford common stock with a value of $20, calculated as described in this proxy statement. In addition, J.P. Morgan relied upon the advice of Ford that it expected to complete its previously announced spin-off of Visteon on June 28, 2000 and upon the advice of counsel as to all legal matters relevant to rendering its opinion.

      J.P. Morgan expressed no opinion as to the price at which new Ford stock will trade at any time following the recapitalization. In addition, J.P. Morgan was not requested to and did not provide advice concerning the structure, the specific amount of the consideration, or any other aspects of the recapitalization or any alternative transactions that may be available to Ford and J.P. Morgan did not participate in any discussions with respect to the terms of the recapitalization and related transactions. J.P. Morgan’s opinion did not address the merits of the underlying decision by Ford to engage in the recapitalization.

      J.P. Morgan’s opinion was necessarily based on economic, market and other conditions as in effect on, and the information made available to J.P. Morgan as of, the date of its opinion. Subsequent developments may affect J.P. Morgan’s opinion, and J.P. Morgan does not have any obligation to update, revise, or reaffirm its opinion.

      The following is a summary of the financial analyses utilized by J.P. Morgan in connection with providing its opinion.

      Historical Common Stock Performance.  J.P. Morgan conducted a historical analysis of the closing price of Ford common stock based on closing prices on the New York Stock Exchange relative to the share price performance of General Motors Corporation and the Standard & Poor’s 400 index over the time periods from June 1, 1990 to June 23, 2000 and June 1, 1995 to June 23, 2000. The share performance of DaimlerChrysler AG from November 13, 1998 to June 23, 2000 was also included in the analysis. In addition, J.P. Morgan performed an analysis of the trading range of Ford common stock over the time period from the announcement date of the recapitalization on April 14, 2000 to June 23, 2000, and over the time period from January 29, 1999 to June 23, 2000 in which the aggregate shares traded approximated the amount of Ford common stock outstanding as of May 19, 2000. The average price for Ford common stock during the 30-day, 60-day and 90-day periods preceding and ending on June 23, 2000 was $48.16, $50.70 and $50.39, respectively. During the 52-week period preceding June 23, 2000, Ford common stock achieved a high closing price of $58.57 on July 1, 1999 and low closing price of $41.00 on March 14, 2000. During the two-year period preceding June 23, 2000, Ford common stock achieved a high closing price of $66.69 on May 3, 1999 and low closing price of $39.75 on October 5, 1998. The all-time high closing price of Ford common stock was $66.69 on May 3, 1999. On June 23, 2000 Ford common stock closed at $44.44 per share.

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      Comparable Trading Multiples.  Using publicly available information, J.P. Morgan compared selected financial data, ratios and multiples of Ford with similar data, ratios and multiples for selected publicly traded companies engaged in businesses which J.P. Morgan judged to be analogous to Ford. Although these companies were judged by J.P. Morgan to be analogous at the time of the opinion, there can be no assurance that these same companies would be considered analogous at any time in the future. The companies selected by J.P. Morgan were:

      These companies were selected, among other reasons, because they compete in the automotive industry with Ford and have reasonably similar competitive dynamics and growth potential. In particular, the most comparable companies to Ford are General Motors Corporation and DaimlerChrysler AG.

      For each comparable company, publicly available financial performance through the twelve months ended March 31, 2000 (or latest fiscal quarter if the company was not on a calendar year) was measured. In addition, J.P. Morgan derived estimates of sales, EBITDA (earnings before interest, taxes, depreciation and amortization), EBIT (earnings before interest and taxes), and net income for calendar years 2000 and 2001 from public equity analyst estimates. The analysis produced a range of multiples for firm value (which J.P. Morgan defined for purposes of its analyses as market value of common equity and preferred stock plus debt net of cash and marketable securities and minority interest) over various estimated financial benchmarks, including sales, EBITDA and EBIT and for the market value of common equity (price) over earnings (the price-to-earnings multiple or P/ E). J.P. Morgan also performed a historical comparison of price-to-earnings multiples between Ford and General Motors Corporation from January 31, 1995 to June 23, 2000.

      Stockholding and Voting Structure.  Using the latest publicly available information, J.P. Morgan analyzed Ford’s stockholder base (including options) and the voting rights associated with each class of capital stock. As of May 19, 2000, Ford had outstanding approximately 1,205 million shares of capital stock, including approximately 71 million Class B shares and approximately 4 million shares of common stock held by directors, nominees and officers of Ford and certain of its affiliates, and 7.1 million depositary shares, each representing 1/2,000 of a share of Series B preferred stock. J.P. Morgan also analyzed the investment objectives of various categories of Ford’s common stockholders.

      Analysis of Recapitalization Impact.  In analyzing the financial impact of the recapitalization on the stockholders, J.P. Morgan conducted several illustrative analyses of the impact of the recapitalization on pro forma 2001 EPS (earnings per share), the impact of the recapitalization on Ford’s leverage, liquidity, and public float (percentage of capital stock held by non-insiders) and of the impact of the recapitalization on the economic and voting interests of each class of stockholders.

      J.P. Morgan performed an illustrative analysis of the pro forma EPS of Ford following the recapitalization, and a comparison of trading value under the all-stock and the $20 cash elections. For this analysis, J.P. Morgan assumed:

	•	a five day volume-weighted average trading price of Ford common stock equal to the June 23, 2000 closing price of $44.44;
	•	a $20 cash distribution;
	•	2001 EPS of $6.30 without a recapitalization (based on J.P. Morgan equity research report of June 2, 2000);

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	•	a range of aggregate cash distributions in the recapitalization from $0, $3, $5, $7 and $10 billion;
	•	a pretax return on cash, were it not distributed following the recapitalization, of 6.0%;
	•	an effective tax rate of 35%; and
	•	a current 2001 P/ E multiple of 7.1x, derived from dividing $44.44 by $6.30.

      The illustrative analysis of the impact of the recapitalization on Ford’s 2001 EPS indicated that, assuming a volume-weighted five-day average trading price ranging between $39-60 per share, the recapitalization was neutral to Ford’s 2001 EPS under a zero cash distribution scenario and up to approximately 19.9% accretive to Ford’s 2001 EPS in the event of a distribution of $10 billion.

      J.P. Morgan also performed an illustrative analysis of the impact of the recapitalization on Ford’s credit ratios by comparing Ford’s actual ratios, including Ford’s 2000 EBITDA/ Interest Expense and Total Debt/2000 EBITDA coverage ratios, at March 31, 2000 (adjusted to reflect the Visteon spinoff) with the pro forma ratios after the recapitalization at various potential levels of total cash distributed. The analysis showed that the recapitalization is not expected to have a material impact on Ford’s 2000 EBITDA/ Interest Expense and Total Debt/2000 EBITDA coverage ratios. Although Ford’s net debt will increase by the amount of cash distributed, Ford’s cash balance following the recapitalization is expected to continue to exceed its total debt, even if $10 billion of cash is distributed in the recapitalization.

      J.P. Morgan also performed an illustrative analysis of the effect of a recapitalization on Ford’s public float employing the same assumptions used in J.P. Morgan’s illustrative analysis of the impact of the recapitalization on Ford’s 2001 EPS. Assuming that Ford distributes $10 billion in the recapitalization and that all Class B stockholders will elect and retain all stock, the recapitalization will reduce Ford’s public float to 92.32% and increase insider holdings to 7.68%.

      J.P. Morgan analyzed the liquidity of Ford stock by comparing the size of its public float and daily trading volume to those of General Motors Corporation and DaimlerChrysler AG. Ford has a smaller public float with 93.75% of total shares outstanding compared to a public float of 99.75% for General Motors Corporation and 99.96% for DaimlerChrysler AG. During the latest twelve months ended on June 23, 2000, Ford common stock traded at an average daily volume that is approximately 0.29% of its public float.

      J.P. Morgan performed an illustrative analysis of the impact of the recapitalization on the economic and voting interests of Ford’s stockholders. In performing this illustrative analysis, J.P. Morgan assumed:

	•	a five day volume-weighted average trading price of Ford common stock equal to the June 23, 2000 closing price of $44.44;
	•	a $20 cash distribution;
	•	an aggregate cash distribution in the recapitalization of $10 billion; and
	•	a new stock election by all Class B stockholders.

      Based on these assumptions, the common stockholders’ continuing economic interest in Ford plus the value of the cash consideration distributed to the common stockholders by Ford is approximately equal to the common stockholders’ economic interest in Ford prior to the recapitalization. Based on the same aforementioned assumptions, the effective voting power of the common stockholders, excluding the Class B stockholders, decreased from 60% prior to the recapitalization to 58% following the recapitalization while the Class B stockholders’ effective voting power in Ford increased from 40% prior to the recapitalization to approximately 42% following the recapitalization as a result of Class B stockholders making all stock elections and receiving shares of new common stock in the recapitalization.

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      J.P. Morgan performed an illustrative analysis of the effect on the voting and economic interests of the common and Class B stockholders in the recapitalization in the event that the volume-weighted five-day average trading price exceeded $60. In such event, the analysis indicated that the allocation of economic interest between common and Class B stockholders (including shares of new common stock that Class B stockholders receive in the recapitalization) world remain the same and that the allocation of voting interests could be slightly different.

      The summary set forth above does not purport to be a complete description of the analyses or data considered by J.P. Morgan. The preparation of a fairness opinion is a complex process and is not necessarily susceptible to partial analysis or summary description. J.P. Morgan believes that one must consider its opinion, this summary and its analyses as a whole. Selecting portions of this summary and these analyses, without considering the analyses as a whole, would create an incomplete view of the processes underlying the analyses and opinion. In arriving at its opinion, J.P. Morgan considered the results of all of the analyses as a whole. No single factor or analysis was determinative of J.P. Morgan’s fairness determination. Rather, the totality of the factors considered and analyses performed operated collectively to support its determination. J.P. Morgan based its analysis on assumptions that it deemed reasonable, including assumptions concerning general business and economic conditions and industry specific factors. This summary sets forth under the description of each analysis the other principal assumptions upon which J.P. Morgan based that analysis. Analyses based upon forecasts of future results are inherently uncertain, as they are subject to numerous factors or events beyond the control of the parties and their advisors. Accordingly, these forecasts and analyses are not necessarily indicative of actual future results, which may be significantly more or less favorable than suggested by those analyses. Therefore, none of Ford, J.P. Morgan or any other person assumes responsibility if future results are materially different from those forecasted. Moreover, J.P. Morgan’s analyses are not and do not purport to be appraisals or otherwise reflective of the future price of Ford’s common stock.

      As a part of its investment banking business, J.P. Morgan and its affiliates are continually engaged in the valuation of businesses and their securities in connection with mergers and acquisitions, investments for passive and control purposes, negotiated underwritings, secondary distribution of listed and unlisted securities, private placements, and valuations for estate, corporate and other purposes. Ford selected J.P. Morgan to deliver an opinion to our board of directors with respect to the recapitalization on the basis of such experience and its familiarity with Ford.

      Ford has agreed to pay J.P. Morgan a fee of $2,000,000 upon delivery of its opinion. In addition, Ford has agreed to reimburse J.P. Morgan for its expenses incurred in connection with its services, including the fees and disbursements of counsel, and has agreed to indemnify J.P. Morgan against certain liabilities, including liabilities arising under the federal securities laws.

      J.P. Morgan and its affiliates are currently providing, and have in the past provided, other investment banking and commercial banking services for Ford unrelated to the recapitalization, for which they expect to receive or have received customary compensation. In the ordinary course of their businesses, J.P. Morgan and its affiliates may actively trade the debt and equity securities of Ford for their own account or for the accounts of customers and, accordingly, they may at any time hold long or short positions in such securities.

Dividend Policy

      Although our board of directors intends to reduce the Company’s per share dividend following the recapitalization, stockholders who make an all stock election and, as a result, will own an increased number of shares of common stock following the recapitalization, will receive, in the aggregate on such increased number of shares, approximately the same quarterly dividend amount as the $.50 per share currently paid. Stockholders who make either of the two cash elections will receive a reduced quarterly dividend following the recapitalization. The determination of the amount of any cash dividends which may be paid in the future will depend upon declaration by our board of

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Interests of Certain Persons in the Recapitalization

      Stock Ownership of Management. We expect that our executive officers will generally make new stock elections with respect to their shares of common stock. In addition, employee stock options are being adjusted to increase the number of shares subject to these options. To the extent that other stockholders elect to receive cash, such elections by executive officers will have the effect of increasing their ownership interest in the Company.

      The table below shows how much of our stock and that of our majority-owned subsidiary, The Hertz Corporation, each director, nominee, and Named Executive (who is a person named in the Summary Compensation Table in Ford’s annual proxy statement for the year 2000 and who is still an executive with the Company as of June 27, 2000), beneficially owned as of March 1, 2000 (except as otherwise noted). No director, nominee, or Named Executives beneficially owned any Ford Series B preferred stock. No director, nominee or executive officer, including Named Executives, beneficially owned more than 0.2% of our 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 our 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, 2000 to buy 7,454,213 shares of our common stock under stock option plans.

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Notes

(1)

Includes restricted shares of common stock issued under the Restricted Stock Plan for Nonemployee Directors, as follows: 1,200 shares for Homer A. Neal; 400 shares each for William Clay Ford, Jr. and Marie-Josee Kravis; and 2,000 shares each for the other eligible nonemployee directors, except John L. Thornton, for whom the number includes 1,150 restricted common stock equivalents under that plan, and except for Jorma J. Ollila and Robert E. Rubin, neither of whom received stock under that plan as of March 1, 2000. For nominees who are or were Ford employees, amounts shown include 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.

	Also, amounts shown include restricted shares of common stock issued under the 1998 Long-Term Incentive Plan as follows: 27,831 shares for William Clay Ford, Jr. as payment for his services as Chairman of the Board of Directors; and 9,277 shares for Edsel B. Ford II as payment for his services pursuant to a consulting agreement with the Company.

(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 2,557 shares of common stock.

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	Also, on March 1, 2000 (or within 60 days after that date), 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:

(3)	These are common stock units credited under a deferred compensation plan and payable in cash.
(4)	As of March 1, 2000, the following persons owned more than 5% of the outstanding Class B Stock: Josephine F. Ford, c/o  Ford Estates, Dearborn, Michigan, beneficially owned 14,388,029 shares (20.30%); and Lynn F. Alandt, c/o  Ford Estates, Dearborn, Michigan, beneficially owned 8,345,489 shares (11.78%).

	Of the Class B Stock outstanding as of March 1, 2000, 47,077,312 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 Dr. Neal include shares acquired on March 20, 2000.
(6)	Shares reported as beneficially owned by John L. Thornton do not include securities held by The Goldman Sachs Group, Inc. in the ordinary course of business.

      The treatment of stock options is described in “Option Plans; Restricted Stock; Other Ford Stock Plans.”

      Impact Resulting From Spin-off of Visteon Corporation. 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 Visteon Corporation on June 28, 2000 the following items held by officers or directors of the Company as of June 12, 2000 will be 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, whether as of March 1, 2000, or another date, are to the unadjusted amounts.

      Class B Stock. Class B stockholders have indicated that it is their intention to vote their shares of Class B stock in favor of the recapitalization and to make new stock elections with respect to their shares of Class B stock and common stock. These elections may have the result of causing the ownership interest in the Company of those stockholders, in the aggregate, to increase as a result of the recapitalization. However, it should be noted that all stockholders will have the right to make such elections.

      The shares of Class B stock, as a group, are entitled to 40% of the general voting power so long as there are at least 60,749,880 shares of Class B stock outstanding. Accordingly, the recapitalization will have the effect of providing liquidity to Class B stockholders either currently through the receipt of cash or, in the future, through subsequent sales of new Ford common stock received in the recapitalization without affecting their level of ownership of the Class B stock or the aggregate 40% voting power of the Class B stock.

      Since the aggregate vote of all shares of common stock is fixed at 60% of the total voting power of the common stock and Class B stock taken together, the issuance of new common stock to holders of Class B stock will permit them to cast a portion of such 60% of the vote, in addition to the

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Option Plans; Restricted Stock; Other Ford Stock Plans

      Options. Outstanding employee options to buy shares of Ford common stock generally will be adjusted, resulting in options to purchase an increased number of shares of new common stock generally determined by multiplying the number of shares currently subject to an option by the sum of one and a fraction, the numerator of which is $20 and the denominator of which is the lesser of $60 and the average of the trading prices of Ford common stock (calculated in the same manner as for purposes of the elections described above), minus $20, at an exercise price generally determined by dividing the exercise price of an option by the sum referred to above. For example, assuming an employee had an option to purchase 100 shares with a current exercise price of $30 and the average of the trading prices of Ford common stock was $60, such employee’s option would generally be converted into an option to purchase 150 new shares with a new exercise price of approximately $20.

      Restricted Stock. Pursuant to the terms of the plans under which shares of restricted stock have been issued to employees or directors, holders of such restricted stock will be required to make all stock elections and the shares of new common stock received will continue to be subject to the same restrictions. Similar treatment will apply to phantom stock and similar awards outstanding.

      Other Ford Stock Plans. In the case of the Ford Motor Company Savings and Stock Investment Plan for Salaried Employees and the Tax- Efficient Savings Plan for Hourly Employees, the master trust for which owned in the aggregate approximately 200,000,000 shares of common stock as of June 27, 2000, participants will be entitled to direct the trustee as to which election they wish the trustee to make with respect to the number of shares attributed to their accounts. A failure to direct the trustee will have the same consequences as a failure to make an election i.e., it will be deemed to be a $20 cash election. Any cash received pursuant to the recapitalization resulting from affirmative cash elections directed by participants will be invested in an interest income fund for such plans, and cash received as a result of a participant failing to direct the trustee, or that results from an override of a participant direction or a payment described below, will be invested in the Ford stock fund for such plans. Ford may determine that cash received as a result of an affirmative direction by a participant may be made available for distribution if the participant wishes to receive such cash in whole or in part.

      In accordance with the requirements of the Employee Retirement Income Security Act of 1974 (ERISA) and the Internal Revenue Code, the trustee will have the ability, if the average Ford share price during the five trading day period ending on July 28, 2000 is greater than the price that the trustee determines constitutes adequate consideration under ERISA and the Internal Revenue Code at the time the trustee submits its election, to ignore new stock and pro rata elections which participants have directed, and to instead make $20 cash elections on their behalf. For a security for which there is a generally recognized market and that trades on a national securities exchange, adequate consideration is defined as the price prevailing on such national securities exchange. Any cash resulting from the trustee’s decision to override a new stock election, and any cash in excess of the amount otherwise payable pursuant to a pro rata election resulting from the trustee’s decision to override such an election, will be invested in the Ford stock fund for such plans.

      Also, in accordance with ERISA and the Internal Revenue Code, if the five day average price is less than the price that the trustee determines constitutes adequate consideration at the time the

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Effective Time of the Recapitalization

      The recapitalization will become effective upon the date that the certificate of merger is filed with the Secretary of State of the State of Delaware. This is expected to occur on August 2, 2000, following the special meeting.

New York Stock Exchange Listing

      We are in the process of obtaining the necessary approval from the New York Stock Exchange in order to effect the recapitalization. Ford common stock is currently listed on the New York Stock Exchange under the symbol “F,” and on a number of foreign exchanges. Following the recapitalization, the new Ford common stock will continue to be listed on the New York Stock Exchange under the symbol “F” and may continue to be listed on some foreign exchanges on which it is currently listed. The new Class B stock will continue to be unlisted.

Appraisal Rights

      If the recapitalization is completed, you may be entitled to seek an appraisal of, and be paid in cash the “fair value” of, your shares instead of receiving the stock or cash that you would otherwise be entitled to under the recapitalization agreement. These rights are commonly referred to as “appraisal rights.” Section 262 of the Delaware General Corporation Law sets forth the requirements that must be satisfied and the procedures that must be followed to exercise appraisal rights. Section 262 is reproduced in Appendix D to this proxy statement/prospectus. The following summary of appraisal rights is conditioned by the full terms of Section 262.

      Holders of Class B stock are entitled to appraisal rights because their stock is not listed on a national securities exchange and does not meet the other requirements of Section 262 for an exemption from appraisal rights. However, because Ford’s common stock is listed on the New York Stock Exchange, holders of common stock are only entitled to appraisal rights under Section 262 if they are required by the terms of the recapitalization agreement to accept, as a result of the recapitalization, anything other than shares of new common stock, other widely held stock or cash in lieu of fractional shares. Because all holders of common stock can elect to receive new common stock in the recapitalization, we believe that appraisal rights are not available to common stockholders who may seek to exercise such rights. Accordingly, we reserve the right to seek a court ruling that the recapitalization does not entitle holders of common stock to appraisal rights.

      Any stockholders who are entitled to appraisal rights must, in order to exercise such rights, demand and perfect such rights in accordance with Section 262. Failure to satisfy the requirements and follow the procedures set forth in Section 262 may result in a loss of appraisal rights. If you demand appraisal but are determined not to be entitled to such rights or otherwise lose such rights, you will be entitled to receive the consideration that you would have been entitled to under the terms of the recapitalization agreement if you had not sought to exercise appraisal rights.

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      Appraisal rights are available only to record holders of shares. If you are not a record holder and you wish to exercise appraisal rights in respect of shares in which you have a beneficial interest and which are held of record by or in the name of another person, such as a broker or nominee, you should act promptly to cause the record holder to follow the procedures set forth in Section 262 to perfect your appraisal rights.

      Section 262 requires us to notify you, at least 20 days before the special meeting, as to the availability of appraisal rights and to provide you with a copy of Section 262. This proxy statement/prospectus, including Appendix D, serves as the required notice.

      To exercise your appraisal rights, you must:

	•	deliver to us before the vote on the recapitalization a written demand for an appraisal of your shares;
	•	continuously hold your shares from the date you deliver a written demand for an appraisal through the effective date of the recapitalization; and
	•	not vote in favor of the recapitalization agreement.

      In addition, if neither any stockholder who has demanded appraisal rights nor the Company has filed a petition in the Delaware Court of Chancery demanding a determination of the fair value of the shares seeking appraisal within 120 days after the effective date of the recapitalization, then all stockholders’ appraisal rights will be lost. We have no obligation and do not intend to file such an appraisal petition. Accordingly, it is the obligation of the stockholders seeking appraisal to file an appropriate appraisal petition with the Court of Chancery within the 120 day time period prescribed by Section 262.

      Any demand for an appraisal must be in writing, signed and mailed or delivered to:

	Ford Motor Company One American Road Room 1038, WHQ Dearborn, Michigan 48126 Attn: Assistant Secretary

      A written demand must reasonably inform us of the identity of the stockholder and of the stockholder’s intent to demand appraisal of his, her or its shares of our stock. Voting against the recapitalization or otherwise failing to vote for the recapitalization will not by itself constitute a demand for an appraisal or sufficient notice of an election to exercise appraisal rights. If you sell or otherwise transfer or dispose of your shares before the effective time of the recapitalization, you will lose your appraisal rights with respect to those shares.

      A demand for appraisal should be signed by or on behalf of the stockholder exactly as the stockholder’s name appears on the stockholder’s stock certificates. If the shares are owned of record in a fiduciary capacity, such as by a trustee, guardian or custodian, the demand should be executed in that capacity, and if the shares are owned of record by more than one person, as in a joint tenancy or tenancy in common, the demand should be executed by or on behalf of all joint owners. An authorized agent, including one or more joint owners, may execute a demand for appraisal on behalf of a record holder; however, in the demand the agent must identify the record owner or owners and expressly disclose that the agent is executing the demand as an agent for the record owner or owners. A record holder such as a broker who holds shares as nominee for several beneficial owners may exercise appraisal rights for the shares held for one or more beneficial owners and not exercise appraisal rights for the shares held for other beneficial owners. In this case, the written demand should state the number of shares for which appraisal rights are being demanded. When no number of shares is stated, the demand will be presumed to cover all shares held of record by the broker or nominee.

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      If the recapitalization is completed, we will send, within 10 days after the effective date of the recapitalization, notice of the effective date of the recapitalization to each stockholder who has properly demanded appraisal rights under Section 262 and has not voted in favor of the recapitalization agreement.

      If you have complied with the requirements for exercising appraisal rights, then during the 120 days following the effective date of the recapitalization, you may request from us a statement as to the aggregate number of shares not voted in favor of the recapitalization agreement and with respect to which demands for appraisal have been received and the number of holders of those shares. Upon receiving any such request, which must be made in writing, we will mail a statement of that information to you within 10 days.

      If a petition for an appraisal is filed within the 120 day period prescribed by Section 262, the Delaware Court of Chancery will hold a hearing on the petition to determine the stockholders entitled to appraisal rights and the “fair value” of their shares as of the effective date of the recapitalization. The determination of fair value will not include any element of value arising from the accomplishment or expectation of the recapitalization. The court will also determine a fair rate of interest, if any, to be paid upon the amount determined to be the fair value of the shares. The court may determine that the fair value of the shares is more than, the same as or less than the value of the consideration that you otherwise would have been entitled to receive under the recapitalization agreement. The Delaware Supreme Court has stated that “proof of value by any techniques or methods that are generally considered acceptable in the financial community and otherwise admissible in court” should be considered in the appraisal proceedings.

      The costs of the action may be determined by the Delaware Court of Chancery and taxed upon the parties as the court deems equitable in the circumstances. Upon application of a stockholder, the court may order that all or a portion of the expenses incurred by any stockholder in an appraisal proceeding, including, without limitation, reasonable attorneys’ fees and the fees and expenses of experts utilized in the appraisal proceeding, be charged pro rata against the value of all of the shares entitled to appraisal.

      If you have duly demanded an appraisal of your shares, you will not, after the effective date of the recapitalization, be entitled to vote those shares for any purpose, nor will you be entitled to the payment of dividends or other distributions on those shares, except for dividends or other distributions payable to stockholders as of a record date before the effective date of the recapitalization.

      You may withdraw your demand for appraisal of your shares within 60 days after the effective date of the recapitalization. Any attempt to withdraw your demand more than 60 days after the effective date of the recapitalization will require our written approval. Once a petition for appraisal is filed with the Delaware Court of Chancery, the appraisal proceeding may not be dismissed without court approval. If your demand for appraisal rights has been effectively withdrawn, you will receive the consideration in the recapitalization which you would otherwise be entitled to, based on the elections, if any, you made and the treatment of other stockholders who made or did not make any such elections.

      If it is determined that you are entitled to appraisal rights and properly demand appraisal of your shares, but fail to perfect your appraisal rights, otherwise lose your appraisal rights or effectively withdraw your demand for an appraisal, your shares will be converted into the right to receive the consideration that you would have been entitled to under the terms of the recapitalization agreement if you had not sought to exercise appraisal rights.

Certain U.S. Federal Income Tax Consequences of the Recapitalization

      The following discussion summarizes the material U.S. federal income tax consequences of the recapitalization to holders of common stock and Class B stock. This discussion assumes that

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	•	financial institutions,
	•	mutual funds,
	•	tax-exempt organizations,
	•	insurance companies,
	•	dealers in securities or foreign currencies,
	•	traders in securities who elect to apply a mark-to-market method of accounting,
	•	stockholders that hold such shares as a hedge against currency risk or as part of a straddle, constructive sale or conversion transaction or
	•	stockholders who acquired their shares upon the exercise of employee stock options or otherwise as compensation.

      The following discussion is not binding on the Internal Revenue Service. It is for general information only and is based upon the Internal Revenue Code, laws, regulations, rulings and decisions in effect as of the date of this proxy statement, all of which are subject to change, possibly with retroactive effect. Tax consequences under state, local and foreign laws are not addressed herein. No ruling has been or will be sought from the Internal Revenue Service as to the U.S. federal income tax consequences of the recapitalization. EACH STOCKHOLDER IS STRONGLY URGED TO CONSULT HIS OR HER TAX ADVISOR AS TO THE SPECIFIC TAX CONSEQUENCES TO SUCH STOCKHOLDER OF THE RECAPITALIZATION, INCLUDING THE APPLICATION OF FEDERAL, STATE, LOCAL AND FOREIGN INCOME AND OTHER TAX LAWS IN HIS OR HER PARTICULAR FACTS AND CIRCUMSTANCES.

      In General. In the opinion of Skadden, Arps, Slate, Meagher & Flom LLP, which is based upon representations of the Company, the recapitalization should constitute a “recapitalization” of the Company within the meaning of Section 368(a)(1)(E) of the Internal Revenue Code. Assuming that the recapitalization qualifies as such, the U.S. federal income tax consequences to each stockholder of the exchange pursuant to the recapitalization will depend upon such stockholder’s particular facts and circumstances. In general, a stockholder who receives (i) a combination of cash and either new common stock or new Class B stock or both may recognize either capital gain (but not loss) or ordinary dividend income, in either case to the extent of the lesser of any cash received or gain realized by such stockholder in the transaction and (ii) solely new common stock or a combination of new common stock and new Class B stock should not recognize any gain or loss. A stockholder who makes the new stock election for some of his or her shares, who owns options to acquire shares or who is treated as related to other stockholders (under the constructive ownership rules described below) who make the new stock election or have options to acquire shares, may have any gain recognized with respect to the cash received in the recapitalization taxed as ordinary dividend income rather than as capital gain. For individual taxpayers, long-term capital gains are generally subject to tax at a maximum U.S. federal income tax rate of 20%, while ordinary dividend income is generally subject to tax at a maximum U.S. federal income tax rate of 39.6%. In addition, the deductibility of capital losses is subject to limitations for both individuals and corporations. Therefore, you should carefully consider the potential tax consequences of the elections. These consequences are discussed below.

      The characterization of any gain recognized on the receipt of cash pursuant to the recapitalization as a capital gain or as ordinary dividend income will depend on whether or not the receipt of such cash has the effect of a distribution of a dividend under Sections 302 and 356(a)(2) of the Internal Revenue Code. Under the principles of Section 302, a stockholder should recognize capital gain rather than dividend income with respect to the cash received if the receipt of cash is (i) in complete redemption of all of the stock of the Company owned by such stockholder, (ii) “not

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      In order for the receipt of cash pursuant to the recapitalization to be treated as “not essentially equivalent to a dividend” with respect to any particular stockholder, it must result in a “meaningful reduction” in such stockholder’s percentage ownership of the stock of the Company. This determination requires that a stockholder compare his or her percentage ownership in the Company (including stock owned constructively) before the recapitalization with his or her percentage ownership in the Company (including stock owned constructively) after the recapitalization. In this regard, the Internal Revenue Service has indicated in published rulings that any reduction in the percentage interest of a public company stockholder whose relative stock interest is minimal (an interest of less than 1% of the outstanding common stock and Class B stock should satisfy this requirement) and who exercises no control over corporate affairs should constitute such a meaningful reduction in such stockholder’s interest.

      In addition, a stockholder’s reduction in his or her percentage ownership of Company stock as a result of receiving cash pursuant to the recapitalization may be “substantially disproportionate,” so that the receipt of cash by such stockholder should result in capital gain or loss, if such stockholder owns less than 50% of the total voting power of the new common stock and the new Class B stock and the percentage of the voting power and value of the new common stock and new Class B stock actually and constructively owned by such stockholder immediately after the recapitalization is less than 80% of both the voting power and the value of the common stock and the Class B stock actually or constructively owned by such stockholder immediately before the recapitalization.

      $20 Cash Election or Pro Rata Election with Respect to All Shares Held. A stockholder who makes a $20 cash election or a pro rata election (or who fails to make any election) with respect to all of his or her shares should recognize ordinary dividend income or capital gain (but not loss) pursuant to the recapitalization to the extent of the lesser of the cash received or the gain realized by such stockholder in the transaction. Assuming such stockholder is not considered to constructively own any shares actually (or constructively) owned by other persons and does not own any options to acquire shares, any such recognized gain should be treated as capital gain if the stockholder has a minimal interest in the Company (an interest of less than 1% of the outstanding common stock and Class B stock should satisfy this requirement) and exercises no control over corporate affairs. Such capital gain will be long-term capital gain if, as of the date of the exchange, the holding period for such shares is more than one year.

      The aggregate adjusted tax basis of the new common stock and new Class B stock received in the recapitalization will be equal to the aggregate tax basis of the common stock and Class B stock surrendered in exchange therefor, decreased by the amount of cash received and increased by the amount of income or gain recognized, if any. The holding period of the new common stock and new Class B stock (as the case may be) will include the holding period of the shares of common stock and Class B stock surrendered in exchange therefor.

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      New Stock Election with Respect to All Shares Held. A stockholder who makes a new stock election with respect to all of his or her shares actually owned should not recognize any gain or loss upon such exchange. The aggregate adjusted tax basis of the shares of the new common stock and new Class B stock received by the stockholder in the recapitalization will be equal to the aggregate adjusted tax basis of the common stock and Class B stock surrendered in exchange therefor. The holding period of the new common stock and new Class B stock (as the case may be) will include the holding period of the common stock and Class B stock surrendered in exchange therefor.

      Mixed Elections and Other Cases. Cash received pursuant to the recapitalization by a stockholder that is not described above (in particular, a stockholder who makes a new stock election for only a portion of his or her shares, who owns options to acquire shares or who is treated as constructively owning shares which are actually (or constructively) owned by other persons) may be taxable as ordinary dividend income (rather than as capital gain), to the extent of such stockholder’s ratable share of the Company’s earnings and profits. The treatment of such cash will depend on the application of the Section 302 principles discussed above to such stockholder. Under the Section 1059 “extraordinary dividend” provision of the Internal Revenue Code, a corporate stockholder may be required to reduce its basis in the new common stock or new Class B stock received (and possibly recognize gain) to the extent the corporate stockholder claims a dividends-received deduction with respect to any portion of the cash received pursuant to the recapitalization.

      Foreign Stockholders — Withholding on Cash. For purposes of the following discussion, a foreign stockholder is any person who is, for U.S. federal income tax purposes, a foreign corporation, a non-resident alien individual, a foreign partnership or a foreign estate or trust.

      Because the cash payable to a particular stockholder in the recapitalization may be treated as a dividend for U.S. federal income tax purposes, U.S. federal income taxes equal to 30% of the cash payable to a foreign stockholder will be withheld unless a reduced rate of withholding is available pursuant to a tax treaty or an exemption from withholding is applicable because such gross proceeds are effectively connected with the conduct of a trade or business within the United States. In order to obtain a reduced rate of withholding pursuant to a tax treaty, a foreign stockholder must deliver to EquiServe or such stockholder’s broker or bank prior to the payment date a properly completed and executed IRS Form 1001 or other applicable form which may, in certain circumstances, consist of a properly completed and executed IRS Form W-8 which includes such foreign stockholder’s address. Stockholders are urged to consult EquiServe or such stockholder’s broker or bank to determine whether such stockholder has previously delivered a valid properly completed and executed IRS Form 1001 or other applicable form and, if not, to determine which form to file. In order to obtain an exemption from withholding on the grounds that the gross proceeds paid pursuant to the recapitalization are effectively connected with the conduct of a trade or business within the United States, a foreign stockholder must deliver to EquiServe or such stockholder’s broker or bank prior to the payment date a properly completed and executed IRS Form 4224 or other applicable form. A foreign stockholder may be eligible to obtain a refund from the IRS of all or a portion of any tax withheld if such stockholder satisfies one or more of the “complete redemption,” “substantially disproportionate” or “not essentially equivalent to a dividend” tests described above or is otherwise able to establish that no tax or a reduced amount of tax is due.

      The preceding discussion is general in nature and does not consider any particular stockholder’s individual facts and circumstances. The tax consequences of the recapitalization to any particular stockholder will depend on his or her individual facts and circumstances. Thus, you are strongly urged to consult your own tax advisor as to the tax consequences to you of the recapitalization and the different elections (and the application of the constructive ownership rules of Section 318).

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Sources and Uses of Funds

      The total amount of resources used to consummate the recapitalization, including to pay fees and expenses in connection therewith, is estimated to be approximately $10 billion. We intend to obtain such funds from available cash and cash equivalents on hand and through the liquidation of marketable securities currently owned by us.

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Selected Historical Consolidated Financial Data

      The following tables set forth selected consolidated financial data and other data concerning Ford for each respective period. The historical consolidated financial data set forth below do not reflect the Visteon spin-off or the recapitalization. The consolidated statement of income data set forth below for each of the three years in the period ended December 31, 1999, and the consolidated balance sheet data set forth below as of December 31, 1999 and 1998, are derived from audited consolidated financial statements incorporated by reference in this document. The consolidated statement of income data set forth below for each of the two years in the period ended December 31, 1996, and the consolidated balance sheet data set forth below as of December 31, 1997, 1996 and 1995, are derived from audited consolidated financial statements not included in this document. The results of operations for each of the five years in the period ended December 31, 1999 have not been restated to reflect Visteon as a discontinued operation. The data for the three-month periods ended and as of March 31, 2000 and 1999, are derived from interim consolidated financial statements not included in this document, which in our opinion include all adjustments necessary for a fair presentation of the results for those periods. The results of operations for the three-month periods ended March 31, 2000 and 1999 and the balance sheet data as of March 31, 2000 have been adjusted to present Visteon as a discontinued operation. Results for the three months ended March 31, 2000 are not necessarily indicative of results that may be expected for the full year. The information is only a summary and you should read it together with the consolidated financial statements of Ford, the pro forma financial statements of Ford and the other information about Ford included elsewhere in, or incorporated by reference in, this document.