21st Apr 2006 15:01
Ford Motor Co21 April 2006 NEWS Contact: Media: Equity Investment Fixed Income Shareholder Inquiries: Community: Becky Sanch Investment Community: 1.800.555.5259 or Raj Modi 1.313.594.4410 Rob Moeller 1.313.845.8540 1.313.323.8221 [email protected] 1.313.621.0881 [email protected] [email protected] [email protected] FOR IMMEDIATE RELEASE FORD REPORTS FIRST QUARTER 2006 FINANCIAL RESULTS • Net loss of 64 cents per share, or $1.2 billion. • Earnings from continuing operations of 24 cents per share, or $458 million, excluding special items.* • Worldwide automotive pre-tax loss of $184 million, excluding special items. • Ford Credit pre-tax profit of $751 million, excluding special items. DEARBORN, Mich., April 21, 2006 - Ford Motor Company (NYSE: F) today reported anet loss of 64 cents per share, or $1.2 billion, for the first quarter of 2006.This compares with net income of 60 cents per share, or $1.2 billion, in thefirst quarter of 2005. Ford's first-quarter earnings from continuing operations, excluding specialitems, was 24 cents per share, or $458 million.* Ford's total sales and revenue in the first quarter was $41.1 billion, down $4.1billion from a year ago. * Earnings per share from continuing operations excluding special items iscalculated on a basis that includes pre-tax profit and provision for taxes andminority interest. See table following "Safe Harbor/Risk Factors" for thenature and amount of these special items and a reconciliation to GAAP. "I am confident that we are confronting our challenges head-on and that we willsucceed in our turnaround and getting back on track to ensure our long-termsuccess," said Chairman and Chief Executive Officer Bill Ford. "We are clearlyin a period of transition. However, I am pleased with the changes underway tomake Ford a leaner, more innovative company. I also am grateful to ouremployees for the cooperation and confidence in Ford that they have demonstratedby embracing these changes, which can be very difficult." Special items reduced earnings by 88 cents per share in the first quarter. Thepre-tax effect of these items include: • A charge of $1.7 billion, or 61 cents per share, for costs associated with expected North America Way Forward-related layoff and jobs bank benefits and voluntary termination packages; • A charge of $414 million, or 14 cents per share, of related non-cash pension curtailment charges; • Facility-related costs, primarily associated with last month's idling of the St. Louis Assembly Plant, of $281 million or 10 cents per share; and • Costs of $95 million, or 3 cents per share, associated with additional personnel reduction programs not directly related to Way Forward. First-quarter highlights included: • Launched Way Forward plan to return North America automotive operations to profitability no later than 2008. Plan includes idling and ceasing operations at 14 manufacturing facilities through 2012, including seven vehicle assembly plants, and initiatives to generate net material cost savings of at least $6 billion by 2010, improve quality and invest in new products. • Introduced U.S. products that are performing well in the marketplace, including Ford Fusion, Mercury Milan and Lincoln Zephyr. • Launched all-new Ford Ranger in Thailand, Ford Fiesta in India, Ford Focus in China and confirmed Volvo S40 would also be locally produced in China. • Best ever first quarter global sales for Land Rover, increasing 26 percent over a year ago. The following discussion of the results of our Automotive sector and Automotivebusiness units is on a basis that excludes special items. See table following "Safe Harbor/Risk Factors" for the nature and amount of these special items and areconciliation to GAAP. AUTOMOTIVE SECTOR On a pre-tax basis, excluding special items of $2.5 billion, worldwideAutomotive sector losses in the first quarter were $184 million. This compareswith a pre-tax profit of $580 million, excluding special items of $107 million,during the same period a year ago. Worldwide automotive sales for the first quarter declined to $37.0 billion from$39.3 billion in the same period last year. Worldwide vehicle unit sales in thequarter were 1,722,000, up from 1,716,000 a year ago. Total cash, including automotive cash, marketable securities, loaned securitiesand short-term Voluntary Employee Beneficiary Association (VEBA) assets at March31, 2006 was $23.7 billion, down from $25.1 billion at the end of the fourthquarter. THE AMERICAS For the first quarter, The Americas reported a pre-tax automotive loss of $323million, excluding special items, compared to a pre-tax profit of $741 millionin the same period a year ago. North America: In the first quarter, Ford's North America automotive operationsreported a pre-tax loss of $457 million, excluding special items, compared witha pre-tax profit of $664 million, excluding special items, a year ago. Thedeterioration primarily reflected lower volumes associated with lower marketshare and a smaller increase in dealer inventories; increased incentivesassociated with a higher mix of leasing and fleet sales; the non-recurrence offavorable warranty reserve adjustments; acceleration of depreciation chargesassociated with announced plant idlings; adverse currency exchange; and lossesassociated with ACH, the former Visteon activities now controlled by Ford.These declines were partially offset by lower net product costs and otherimprovements primarily associated with implementation of our personnel andcapacity reduction actions. Sales were $19.8 billion, down from $21.1 billionfor the same period a year ago. South America: Ford's South America automotive operations reported afirst-quarter pre-tax profit of $134 million, an increase of $57 million from a$77 million pre-tax profit a year ago. Pricing and higher industry volume,partially offset by higher commodity prices, were the primary drivers of theimprovement. Sales for the first quarter improved to $1.2 billion from $866million in 2005. INTERNATIONAL OPERATIONS In the first quarter, International Operations reported a combined automotivepre-tax profit, excluding special items, of $301 million, an improvement of $200million from first quarter 2005. FORD EUROPE AND PREMIER AUTOMOTIVE GROUP (PAG) The combined first-quarter automotive pre-tax profit, excluding special items,for Ford Europe and PAG automotive operations was $254 million, an improvementof $250 million from the same period a year ago. Ford Europe: Ford Europe's first-quarter pre-tax profit was $91 million,excluding special items, compared with a pre-tax profit of $59 million duringthe 2005 period. The improvement was more than explained by cost reductions,primarily material costs, and favorable mix, partially offset by lower netpricing. During the first quarter, Ford Europe negotiated an investmentsecurity agreement with the German works council that provides job protectionwhile achieving a more competitive manufacturing cost base. Ford Europe's salesin the first quarter were $6.8 billion, compared with $7.7 billion during firstquarter 2005. Premier Automotive Group (PAG): PAG reported a pre-tax profit, excludingspecial items, of $163 million for the first quarter, compared with a pre-taxloss of $55 million for the same period in 2005. The improvement primarilyreflected cost improvements at Volvo, Jaguar, and Land Rover and increased salesof Range Rover Sport, contributing to improved mix. The improvements werepartially offset by unfavorable currency exchange and lower net pricing.First-quarter sales for PAG were $7.1 billion, compared with $7.6 billion a yearago. ASIA PACIFIC AND AFRICA/MAZDA In the first quarter, Asia Pacific and Africa/Mazda reported a combined pre-taxprofit of $47 million, compared with a pre-tax profit of $97 million in 2005. Asia Pacific and Africa: For the first quarter, Asia Pacific and Africareported a pre-tax profit of $2 million, compared with a pre-tax profit of $43million a year ago. The decline primarily reflected lower Falcon volumes inAustralia, unfavorable currency exchange, and the non-recurrence of last year'ssale of our interest in Mahindra & Mahindra in India, partially offset byimproved performance in our joint ventures, primarily in China. Sales were $1.7billion, compared with $2.0 billion in 2005. Mazda: During the first quarter of 2006, Ford's share of Mazda profits andassociated operations was $45 million, compared with $54 million during the sameperiod a year ago. The decline primarily reflected lower gains during thequarter on our investment in Mazda's convertible bonds. All of these bonds havenow been converted to equity. OTHER AUTOMOTIVE First-quarter results included a loss of $162 million in Other Automotive,compared with a loss of $262 million a year ago. The year-over-year improvementprimarily reflected higher interest income from our cash portfolio, due tohigher short-term interest rates and higher cash balances. FINANCIAL SERVICES SECTOR For the first-quarter, Financial Services sector earned a pre-tax profit of $744million, compared with pre-tax profits of $1.1 billion a year ago. Ford Motor Credit Company: Ford Motor Credit Company reported net income of $479million in the first quarter of 2006, down $231 million from earnings of $710million a year earlier. On a pre-tax basis from continuing operations, FordMotor Credit earned $751 million in the first quarter, compared with $1.1billion in the previous year. The decrease in earnings primarily reflectedhigher borrowing costs, the impact of lower receivable levels and higherdepreciation expense, partially offset by improved credit loss performance. FULL-YEAR SPECIAL ITEMS The company previously announced it anticipated full-year pre-tax special itemsof about $1 billion, with further study required to assess additional costsstemming from the Way Forward plan and to determine appropriate accounting forthese costs. The present expectation is that total full-year pre-tax specialitems, including these jobs bank-related costs and associated pensioncurtailment charges, will be about $3.4 billion. Executive Vice President and Chief Financial Officer Don Leclair said, "Today'sresults reflect the business environment we are facing and the actions we aretaking to address our issues. We remain committed to implementing our plans toturn around the automotive business." FIRST QUARTER CONFERENCE CALL DETAILS Ford Motor Company will release first quarter 2006 financial results at 7 a.m.EDT on Friday, April 21. The following briefings will be held after theannouncement: At 9 a.m. EDT, Chairman and CEO, Bill Ford, and Executive Vice President andCFO, Don Leclair, will host a conference call for news media and analysts todiscuss first-quarter financial results. Following the earnings call, at 11 a.m. EDT, Ford Vice President and TreasurerAnn Marie Petach, Ford Motor Credit Company Vice Chairman and CFO K.R. Kent, andFord Vice President and Controller Jim Gouin, will host a conference call forfixed income analysts and investors. The presentations (listen-only) and supporting materials will be available onthe Internet at www.shareholder.ford.com. Representatives of the news media andthe investment community participating by teleconference will have theopportunity to ask questions following the presentations. Access Information - Friday, April 21Toll Free: 800-706-7741International: 617-614-3471 Earnings: 9:00 a.m. EDTEarnings Passcode: "Ford Earnings Call" Fixed Income: 11:00 a.m. EDTFixed Income Passcode: "Ford Fixed Income" Replays - Available through Friday, April 28www.shareholder.ford.comToll Free: 888-286-8010International: 617-801-6888 Passcodes:Earnings: 29481628Fixed Income: 55865600 Ford Motor Company, a global automotive industry leader based in Dearborn,Mich., manufactures and distributes automobiles in 200 markets across sixcontinents. With about 300,000 employees and 108 plants worldwide, thecompany's core and affiliated automotive brands include Aston Martin, Ford,Jaguar, Land Rover, Lincoln, Mazda, Mercury and Volvo. Its automotive-relatedservices include Ford Motor Credit Company. - # # # - Safe Harbor/Risk Factors Statements included or incorporated by reference herein may constitute "forward-looking statements" within the meaning of the Private SecuritiesLitigation Reform Act of 1995. Forward-looking statements are based onexpectations, forecasts and assumptions by our management and involve a numberof risks, uncertainties, and other factors that could cause actual results todiffer materially from those stated, including, without limitation: • Continued decline in market share; • Continued or increased price competition resulting from industry overcapacity, currency fluctuations or other factors; • A market shift (or an increase in or acceleration of market shift) away from sales of trucks or sport utility vehicles, or from sales of other more profitable vehicles in the United States; • A significant decline in industry sales, particularly in the United States or Europe, resulting from slowing economic growth, geo-political events or other factors; • Lower-than-anticipated market acceptance of new or existing products; • Continued or increased high prices for or reduced availability of fuel; • Currency or commodity price fluctuations; • Adverse effects from the bankruptcy or insolvency of a major competitor; • Economic distress of suppliers that has in the past and may in the future require us to provide financial support or take other measures to ensure supplies of components or materials; • Work stoppages at Ford or supplier facilities or other interruptions of supplies; • Single-source supply of components or materials; • Labor or other constraints on our ability to restructure our business; • Worse-than-assumed economic and demographic experience for our postretirement benefit plans (e.g., discount rates, investment returns, and health care cost trends); • The discovery of defects in vehicles resulting in delays in new model launches, recall campaigns or increased warranty costs; • Increased safety, emissions, fuel economy or other (e.g., pension funding) regulation resulting in higher costs, cash expenditures, and/or sales restrictions; • Unusual or significant litigation or governmental investigations arising out of alleged defects in our products or otherwise; • A change in our requirements for parts or materials where we have entered into long-term supply arrangements that commit us to purchase minimum or fixed quantities of certain parts or materials, or to pay a minimum amount to the seller ("take-or-pay contracts"); • Inability to access debt or securitization markets around the world at competitive rates or in sufficient amounts due to additional credit rating downgrades or otherwise; • Higher-than-expected credit losses; • Increased competition from banks or other financial institutions seeking to increase their share of financing Ford vehicles; • Changes in interest rates; • Collection and servicing problems related to finance receivables and net investment in operating leases; • Lower-than-anticipated residual values or higher-than-expected return volumes for leased vehicles; • New or increased credit, consumer or data protection or other regulations resulting in higher costs and/or additional financing restrictions; and • Inability to implement the Way Forward plan. We cannot be certain that any expectation, forecast or assumption made bymanagement in preparing these forward-looking statements will prove accurate, orthat any projection will be realized. It is to be expected that there may bedifferences between projected and actual results. Our forward-lookingstatements speak only as of the date of their initial issuance, and we do notundertake any obligation to update or revise publicly any forward-lookingstatement, whether as a result of new information, future events or otherwise. *** TOTAL COMPANY 2006 FIRST QUARTER INCOME FROM CONTINUING OPERATIONS COMPARED WITHNET INCOME First Quarter Earnings Per After-Tax Pre-Tax Share* Profit Profit (Mils.) (Mils.) Income/(Loss) from Continuing Operations Excluding $ 0.24 $ 458 $ 560Special Items Special Items• Way Forward Jobs Bank/Employee Separation $ (0.61) $ (1,131) $ (1,741)• Pension Curtailment Charges (0.14) (269) (414)• Facility-Related U.S. Plant Idling Costs (0.10) (183) (281)• Additional Personnel Reduction Programs (0.03) (62) (95) Total Special Items $ (0.88) $ (1,645) $ (2,531) Income/(Loss) from Continuing Operations $ (0.64) $ (1,187) $ (1,971) Memo: Total Net Income/(Loss) $ (0.64) $ (1,187) * Earnings per share from continuing operations is calculated on a basisthat includes pre-tax profit, provision for taxes, and minority interest; additional information regarding the method of calculating earnings per share is available in the materials supporting the April 21, 2006, conference calls at www.shareholder.ford.com. FORD MOTOR COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENT OF INCOME For the Periods Ended March 31, 2006 and 2005 (in millions, except per share amounts) First Quarter 2006 2005 (unaudited) Sales and revenuesAutomotive sales $ 36,985 $ 39,332Financial Services revenues 4,070 5,804 Total sales and revenues 41,055 45,136 Costs and expensesCost of sales 36,674 35,558Selling, administrative and other expenses 4,592 6,090Interest expense 2,019 1,964Financial Services provision for credit and insurance losses 35 185 Total costs and expenses 43,320 43,797 Automotive interest income and other non-operating income/(expense), net 215 153Automotive equity in net income/(loss) of affiliated companies 79 57 Income/(loss) before income taxes (1,971) 1,549Provision for/(benefit from) income taxes (843) 314 Income/(loss) before minority interests (1,128) 1,235Minority interests in net income/(loss) of subsidiaries 59 58 Income/(loss) from continuing operations (1,187) 1,177Income/(loss) from discontinued operations - 35 Net income/(loss) $ (1,187) $ 1,212 AMOUNTS PER SHARE OF COMMON AND CLASS B STOCK Basic income/(loss)Income/(loss) from continuing operations $ (0.64) $ 0.64Income/(loss) from discontinued operations - 0.02 Net income/(loss) $ (0.64) $ 0.66 Diluted income/(loss)Income/(loss) from continuing operations $ (0.64) $ 0.58Income/(loss) from discontinued operations - 0.02 Net income/(loss) (0.64) 0.60 Cash dividends $ 0.10 $ 0.10 FORD MOTOR COMPANY AND SUBSIDIARIES SECTOR STATEMENT OF INCOME For the Periods Ended March 31, 2006 and 2005 (in millions, except per share amounts) First Quarter 2006 2005 (unaudited)AUTOMOTIVESales $36,985 $39,332Costs and expensesCost of sales 36,674 35,558Selling, administrative and other expenses 2,974 3,109Total costs and expenses 39,648 38,667Operating income/(loss) (2,663) 665 Interest expense 346 402 Interest income and other non-operating income/(expense), 215 153netEquity in net income/(loss) of affiliated companies 79 57Income/(loss) before income taxes - Automotive (2,715) 473 FINANCIAL SERVICESRevenues 4,070 5,804Costs and expensesInterest expense 1,673 1,562Depreciation 1,208 1,514Operating and other expenses 410 1,467Provision for credit and insurance losses 35 185Total costs and expenses 3,326 4,728Income/(loss) before income taxes - Financial Services 744 1,076 TOTAL COMPANYIncome/(loss) before income taxes (1,971) 1,549Provision for/(benefit from) income taxes (843) 314Income/(loss) before minority interests (1,128) 1,235Minority interests in net income/(loss) of subsidiaries 59 58Income/(loss) from continuing operations (1,187) 1,177Income/(loss) from discontinued operations - 35Net income/(loss) $(1,187) $1,212 AMOUNTS PER SHARE OF COMMON AND CLASS B STOCKBasic income/(loss)Income/(loss) from continuing operations $(0.64) $0.64Income/(loss) from discontinued operations - 0.02Net income/(loss) $(0.64) $0.66Diluted income/(loss)Income/(loss) from continuing operations $(0.64) $0.58Income/(loss) from discontinued operations - 0.02Net income/(loss) $(0.64) $0.60Cash dividends $0.10 $0.10 FORD MOTOR COMPANY AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET (in millions) March 31, December 31, 2006 2005 (unaudited)ASSETSCash and cash equivalents $21,179 $28,406Marketable securities 14,732 10,672Loaned securities 3,160 3,461Finance receivables, net 103,986 105,975Other receivables, net 8,824 8,522Net investment in operating leases 28,952 27,099Retained interest in sold receivables 1,399 1,420Inventories 11,962 10,271Equity in net assets of affiliated companies 2,557 2,579Net property 40,941 40,706Deferred income taxes 6,767 5,881Goodwill and other intangible assets 6,072 5,945Assets of discontinued/held-for-sale operations - 5Other assets 18,545 18,534Total assets $ 269,076 $269,476 LIABILITIES AND STOCKHOLDERS' EQUITYPayables $24,005 $22,813Accrued liabilities and deferred revenue 75,512 72,977Debt 151,104 154,332Deferred income taxes 5,284 5,275Total liabilities 255,905 255,397 Minority interests 1,122 1,122 Stockholders' equityCapital stockCommon Stock, par value $0.01 per share (1,837million shares issued) 18 18Class B Stock, par value $0.01 per share (71million shares issued) 1 1Capital in excess of par value of stock 4,778 4,872Accumulated other comprehensive income/(loss) (3,156) (3,562)Treasury stock (680) (833)Earnings retained for use in business 11,088 12,461Total stockholders' equity 12,049 12,957Total liabilities and stockholders' equity $269,076 $269,476 Prior year amounts have been revised to reflect a reclassification betweenFinancial Services sector Cash and cash equivalents and Marketable securities asof December 31, 2005. FORD MOTOR COMPANY AND SUBSIDIARIES SECTOR BALANCE SHEET (in millions) March 31, December 31, 2006 2005 (unaudited)ASSETSAutomotiveCash and cash equivalents $10,104 $13,388Marketable securities 9,044 6,860Loaned securities 3,160 3,461Total cash, marketable and loaned securities 22,308 23,709Receivables, net 3,279 3,061Inventories 11,962 10,271Deferred income taxes 1,083 1,187Other current assets 9,049 8,177Current receivable from Financial Services 324 -Total current assets 48,005 46,405Equity in net assets of affiliated companies 1,736 1,756Net property 40,621 40,378Deferred income taxes 11,746 11,049Goodwill and other intangible assets 6,055 5,928Assets of discontinued/held-for-sale operations - 5Other assets 8,369 8,308Total Automotive assets 116,532 113,829Financial ServicesCash and cash equivalents 11,075 15,018Marketable securities 5,688 3,812Finance receivables, net 109,531 111,436Net investment in operating leases 24,411 22,951Retained interest in sold receivables 1,399 1,420Goodwill and other intangible assets 17 17Other assets 6,909 7,457Current receivable from Automotive - 83Total Financial Services assets 159,030 162,194Intersector elimination (324) (83)Total assets $275,238 $275,940 LIABILITIES AND STOCKHOLDERS' EQUITYAutomotiveTrade payables $18,052 $16,554Other payables 4,195 4,222Accrued liabilities and deferred revenue 30,191 28,733Deferred income taxes 852 804Debt payable within one year 1,264 978Current payable to Financial Services - 83Total current liabilities 54,554 51,374Long-term debt 16,510 16,900Other liabilities 40,135 38,639Deferred income taxes 355 586Total Automotive liabilities 111,554 107,499Financial ServicesPayables 1,758 2,037Debt 133,330 136,454Deferred income taxes 10,239 10,349Other liabilities and deferred income 5,186 5,605Payable to Automotive 324 -Total Financial Services liabilities 150,837 154,445 Minority interests 1,122 1,122 Stockholders' equityCapital stockCommon Stock, par value $0.01 per share (1,837million shares issued) 18 18Class B Stock, par value $0.01 per share (71million shares issued) 1 1Capital in excess of par value of stock 4,778 4,872Accumulated other comprehensive income/(loss) (3,156) (3,562)Treasury stock (680) (833)Earnings retained for use in business 11,088 12,461Total stockholders' equity 12,049 12,957Intersector elimination (324) (83)Total liabilities and stockholders' equity $275,238 $275,940 Prior year amounts have been revised to reflect a reclassification betweenFinancial Services sector Cash and cash equivalents and Marketable securities asof December 31, 2005. FORD MOTOR COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS For the Periods Ended March 31, 2006 and 2005 (in millions) First Quarter 2006 2005 (unaudited) Cash flows from operating activities of continuingoperationsNet cash (used in) provided by operating activities $(194) $5,165 Cash flows from investing activities of continuingoperationsCapital expenditures (1,838) (1,561)Acquisitions of retail and other finance receivables andoperating leases (13,732) (14,035)Collections of retail and other finance receivables andoperating leases 11,446 12,877Net acquisitions of daily rental vehicles - (1,283)Purchases of securities (6,735) (1,922)Sales and maturities of securities 4,501 1,931Proceeds from sales of retail and other financereceivables and operating leases 2,540 8,373Proceeds from sale of businesses 50 39Transfer of cash balances upon disposition ofdiscontinued/held-for-sale operations (4) -Other 41 (195)Net cash (used in)/provided by investing activities (3,731) 4,224 Cash flows from financing activities of continuingoperationsCash dividends (186) (183)Net sales/(purchases) of Common Stock 42 (14)Changes in short-term debt 1,102 (410)Proceeds from issuance of other debt 10,007 5,522Principal payments on other debt (14,446) (14,312)Other 126 (21)Net cash (used in)/provided by financing activities (3,355) (9,418) Effect of exchange rate changes on cash 49 (137) Net increase/(decrease) in cash and cash equivalents fromcontinuing operations (7,231) (166) Cash flows from discontinued operationsCash flows from operating activities of discontinuedoperations - 111Cash flows from investing activities of discontinuedoperations - (60)Cash flows from financing activities of discontinued - -operations Net increase/(decrease) in cash and cash equivalents $(7,231) $(115) Cash and cash equivalents at January 1 $28,406 $22,828Cash and cash equivalents of discontinued/held-for-saleoperations at January 1 4 681Net increase/(decrease) in cash and cash equivalents (7,231) (115)Less: cash and cash equivalents ofdiscontinued/held-for-sale operations at March 31 - (748)Cash and cash equivalents at March 31 $21,179 $22,646 Prior year amounts have been revised to reflect a reclassification betweenFinancial Services sector Cash and cash equivalents and Marketable securities asof December 31, 2005. FORD MOTOR COMPANY AND SUBSIDIARIES CONDENSED SECTOR STATEMENT OF CASH FLOWS For the Periods Ended March 31, 2006 and 2005 (in millions) First Quarter 2006 First Quarter 2005 Automotive Financial Automotive Financial Services Services (unaudited) (unaudited) Cash flows from operating activitiesof continuing operationsNet cash (used in) providedby operating activities $(653) $1,043 $1,839 $3,461 Cash flows from investing activitiesof continuing operationsCapital expenditures (1,820) (18) (1,436) (125)Acquisitions of retail andother finance receivablesand operating leases - (13,732) - (14,035)Collections of retail andother finance receivablesand operating leases - 11,276 - 12,762Net (increase)/decrease inwholesale receivables - (414) - (1,463)Net acquisitions of dailyrental vehicles - - - (1,283)Purchases of securities (1,739) (4,996) (1,808) (114)Sales and maturities ofsecurities 1,271 3,230 1,540 391Proceeds from sales ofretail and other financereceivables and operating leases - 2,540 - 8,373Proceeds from sale ofwholesale receivables - - - 1,443Proceeds from sale ofbusinesses 50 - 39 -Transfer of cash balancesupon disposition ofdiscontinued/held-for-saleoperations (4) - - -Net investing activity withFinancial Services 184 - 415 -Other 23 18 (42) (153)Net cash (used in)/providedby investing activities (2,035) (2,096) (1,292) 5,796 Cash flows from financing activitiesof continuing operations Cash dividends (186) - (183) -Net sales/(purchases) ofCommon Stock 42 - (14) -Changes in short-term debt 86 1,016 (7) (403)Proceeds from issuance ofother debt 91 9,916 76 5,446Principal payments on otherdebt (271) (14,175) (373) (13,939)Net financing activity withAutomotive - (184) - (415)Other 131 (5) (3) (18)Net cash (used in)/providedby financing activities (107) (3,432) (504) (9,329) Effect of exchange ratechanges on cash (23) 72 56 (193)Net change in intersectorreceivables/payables andother liabilities (470) 470 (710) 710Net increase/(decrease) incash and cash equivalentsfrom continuing operations (3,288) (3,943) (611) 445 Cash flows from discontinuedoperationsCash flows from operatingactivities of discontinuedoperations - - 40 71Cash flows from investingactivities of discontinuedoperations - - 6 (66)Cash flows from financing activities - - - -of discontinued operations Net increase/(decrease) incash and cash equivalents $(3,288) $(3,943) $(565) $450 Cash and cash equivalents atJanuary 1 $13,388 $15,018 $10,139 $12,689Cash and cash equivalents ofdiscontinued/held-for-saleoperations at January 1 4 - 2 679Net increase/(decrease) incash and cash equivalents (3,288) (3,943) (565) 450Less: cash and cashequivalents ofdiscontinued/held-for-saleoperations at March 31 - - (48) (700)Cash and cash equivalents atMarch 31 $10,104 $11,075 $9,528 $13,118 Prior year amounts have been revised to reflect a reclassification betweenFinancial Services sector Cash and cash equivalents and Marketable securities asof December 31, 2005. 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