Ford 2010 Annual Report Download - page 31

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Management’s Discussion and Analysis of Financial Condition and Results of Operations
Ford Motor Company | 2010 Annual Report 29
Leveraging global product programs has helped increase overall product development efficiency by a projected 66%
between 2006 and 2012. Global programs that continue to offer bold, emotive designs, high levels of quality, fuel
economy leadership, top safety ratings, innovative technologies, and greater feature content than higher-series
competitive offerings also will allow us to reduce brand discounts and increase revenue across our portfolio. This overall
combination of cost efficiency and revenue enhancement that is being realized from One Ford and our global product
strategy will help us continue to profitably grow.
Finance Our Plan and Strengthen Our Balance Sheet
As discussed in more detail in "Liquidity and Capital Resources" below, during 2010 we generated positive Automotive
operating-related cash flow of $4.4 billion. This contributed to our ability to reduce Automotive debt by $14.5 billion in
2010, from a total of $33.6 billion at the end of 2009 to $19.1 billion at the end of 2010.
Even with our substantial debt reduction actions in 2010, shown in the table below, we were able to maintain a
significant level of Automotive gross cash (i.e., cash and cash equivalents and marketable securities) and ended 2010 with
Automotive gross cash exceeding total Automotive debt by $1.4 billion, also as shown in the table below (in billions):
December 31,
December 31, December 31,
December 31,
2010
20102010
2010
September 30,
September 30, September 30,
September 30,
2010
20102010
2010
December 31,
December 31, December 31,
December 31,
2009
20092009
2009
Automotive gross cash................................................................
................................
$ 20.5 $ 23.8 $ 24.9
Less debt:
Revolving line of credit................................................................
................................
0.8 2.5 7.5
VEBA debt ................................................................
................................
— 3.6 7.0
Unsecured convertible notes................................
................................
0.7 2.6 2.6
Term loan................................................................
................................
4.1 4.9 5.3
All other debt................................................................
................................
13.5 12.8 11.2
Total debt................................................................
................................
19.1 26.4 33.6
Net cash/(debt) ................................................................
................................
$ 1.4 $ (2.6) $ (8.7)
We believe that our stable management team, our strong supplier and dealer relationships, the positive acceptance of
our products by customers, and our full pipeline of new products allow us to compete effectively in the global vehicle
markets while we reduce our debt.
Work Together Effectively as One Team
As part of the One Team approach, we have implemented a disciplined business plan process to regularly review our
business environment, risks and opportunities, strategy, and plan, and to identify areas of our plan that need special
attention while pursuing opportunities to improve our plan. Everyone is included and contributes, openness is
encouraged, our leaders are responsible and accountable, we use facts and data to make our decisions, high
performance teamwork is a performance criteria – and we follow this process every week, every month, and every
quarter, driving continuous improvement. We believe this process gives us a clear picture of our business in real time
and the ability to respond quickly and decisively to new issues and changing conditions – as we have done in the face of
rapid changes in the market and business environment in the last few years.
In addition, we are partnering with and enlisting all of our stakeholders to help us execute our plan to deal with our
business realities and create an exciting and viable Ford business going forward. We are reaching out and listening to
customers, dealers, employees, the UAW, suppliers, investors, communities, retirees, and federal, state and local
governments. Each of these constituencies is a critical part of the success of our business going forward. Realizing our
goal of profitable growth for all is as important to these stakeholders as it is to our shareholders.