SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 11-K
(Mark One)
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
X EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
-----
For the fiscal year ended December 30, 2002
OR
TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
-----
For the transition period from ________________ to ________________
Commission file number 1-3950
FORD MOTOR COMPANY TAX-EFFICIENT
SAVINGS PLAN FOR HOURLY EMPLOYEES
(Full title of the plan)
FORD MOTOR COMPANY
One American Road
Dearborn, Michigan 48126
(Name of issuer of the securities held
pursuant to the plan and the address of
its principal executive office)
2
Required Information
--------------------
Financial Statements and Schedules
----------------------------------
Statement of Net Assets Available for Plan Benefits, as of December 30,
2002 and December 30, 2001.
Statement of Changes in Net Assets Available for Plan Benefits for the
year ended December 30, 2002.
Schedule I - Schedule of Assets Held for Investment Purposes as of
December 30, 2002.
Exhibit
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Designation Description Method of Filing
----------- ----------- ----------------
Exhibit 23 Consent of PricewaterhouseCoopers LLP Filed with this Report.
Exhibit 99 Certification of Chair of Savings Plan
Committee Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002 Filed with this Report.
Signature
---------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Ford Motor Company Tax-Efficient Savings Plan for Hourly Employees Committee has
duly caused this Annual Report to be signed by the undersigned thereunto duly
authorized.
TAX-EFFICIENT SAVINGS PLAN FOR
HOURLY EMPLOYEES
By: /s/Charles E. Corbett
-------------------------------
Charles E. Corbett, Chair
Tax-Efficient Savings Plan for
Hourly Employees Committee
June 23, 2003
3
EXHIBIT INDEX
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Sequential
Page Number
Designation Description at Which Found
----------- ----------- --------------
Exhibit 23 Consent of PricewaterhouseCoopers LLP
Exhibit 99 Certification of Chair of Savings Plan
Committee Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
Ford Motor Company
Tax-Efficient Savings Plan for
Hourly Employees
Financial Statements and Supplemental Schedules
December 30, 2002 and 2001
Ford Motor Company Tax-Efficient
Savings Plan for Hourly Employees
Contents
December 30, 2002 and 2001
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Page(s)
Report of Independent Accountants..............................................1
Financial Statements
Statement of Net Assets Available for Benefits
as of December 30, 2002 and 2001..............................................2
Statement of Changes in Net Assets Available for
Benefits for the Year Ended December 30, 2002.................................3
Notes to Financial Statements................................................4-8
Supplemental Schedule*
Schedule I - Schedule of Assets Held at End of Year
as of December 30, 2002....................................................9-10
* All other schedules required by 29 CFR 2520.103-10 are not included because
they are not applicable.
Report of Independent Accountants
To the Board of Directors of
Ford Motor Company
In our opinion, the accompanying statements of net assets available for benefits
and the related statement of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of Ford Motor Company Tax-Efficient Savings Plan for Hourly Employees (the
"Plan") at December 30, 2002 and 2001, and the changes in net assets available
for benefits for the year ended December 30, 2002, in conformity with accounting
principles generally accepted in the United States of America. These financial
statements are the responsibility of the Plan's management; our responsibility
is to express an opinion on these financial statements based on our audits. We
conducted our audits of these statements in accordance with auditing standards
generally accepted in the United States of America, which require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of Assets Held
at End of Year as of December 30, 2002 is presented for the purpose of
additional analysis and is not a required part of the basic financial statements
but is supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. This supplemental schedule is the responsibility of the
Plan's management. The supplemental schedule has been subjected to the auditing
procedures applied in the audits of the basic financial statements and, in our
opinion, is fairly stated in all material respects in relation to the basic
financial statements taken as a whole.
/s/PricewaterhouseCoopers LLP
June 16, 2003
1
Ford Motor Company Tax-Efficient
Savings Plan for Hourly Employees
Statement of Net Assets Available for Benefits
As of December 30, 2002 and 2001
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2002 2001
Assets
Investments, at fair value $ 2,922,894,249 $ 3,540,430,917
Participant loans 216,889,042 232,788,943
----------------- -----------------
Total assets 3,139,783,291 3,773,219,860
----------------- -----------------
Assets available for benefits $ 3,139,783,291 $ 3,773,219,860
The accompanying notes are an integral part of these financial statements.
2
Ford Motor Company Tax-Efficient
Savings Plan for Hourly Employees
Statement of Changes in Net Assets Available for Benefits
Year Ended December 30, 2002 and 2001
--------------------------------------------------------------------------------
Additions
Interest and dividends $ 95,026,161
-------------------
95,026,161
Contributions
Employee contributions 322,772,138
-------------------
322,772,138
Other additions
Loan repayment interest 14,182,326
-------------------
14,182,326
-------------------
Total additions 431,980,625
Deductions
Net depreciation in fair value of investments (899,645,033)
Withdrawal of participants' accounts (159,511,150)
Net transfers (to) from other plans (6,261,011)
-------------------
Total deductions (1,065,417,194)
-------------------
Net decrease (633,436,569)
-------------------
Net assets available for benefits
Beginning of year 3,773,219,860
-------------------
End of year $3,139,783,291
-------------------
The accompanying notes are an integral part of these financial statements.
3
Ford Motor Company Tax-Efficient
Savings Plan for Hourly Employees
Notes to Financial Statements
December 30, 2002 and 2001
--------------------------------------------------------------------------------
1. Description of the Plan
The following description of the Ford Motor Company Tax-Efficient Savings
Plan for Hourly Employees (the "Plan") provides only general information.
The Plan was established effective January 1, 1985. The provisions of the
Plan are governed in all respects by the detailed terms and conditions
contained in the Plan agreement.
Type and Purpose of the Plan
The Plan is a defined contribution plan established to encourage and
facilitate systematic savings and investment by eligible hourly employees
of Ford Motor Company (the "Company") and to provide them with an
opportunity to become stockholders of the Company. The Plan includes
provisions for voting shares of Company stock. It is subject to certain
provisions of the Employee Retirement Income Security Act of 1974 ("ERISA")
applicable to defined contribution pension plans.
Eligibility and Vesting
Hourly employees are eligible to participate in the Plan three months after
their original date of hire. Certain other part-time and temporary
employees may also be eligible to participate in the Plan. Participation in
the Plan is voluntary. Employees vest 100 percent immediately in the Plan.
Contributions
Under the Plan and subject to limits required to be imposed by the Internal
Revenue Code, participants may elect to contribute up to 40 percent of
their eligible wages on either or both a pre-tax or after-tax basis.
Participants may also elect reductions in their distributions under the
Company's Profit Sharing Plan to be contributed to the Plan. Such pre-tax
contributions are excluded from participants' taxable income.
Subject to Ford Motor Company approval, participants may elect to roll over
amounts from other qualifying plans or arrangements in accordance with the
Internal Revenue Code. For the year ended December 31, 2002, transfers
from other qualifying plans or arrangements amounted to $4.0 million
which are shown as employee contributions in the statements of changes
in net assets available for plan benefits.
Net transfers are principally dividends paid to participants in the Ford
Common Stock Fund who have elected to receive the dividend in the form of
cash instead of purchasing additional shares.
Participant Accounts
Each participant's account is credited with the participant's contributions
and an allocation of plan earnings. Allocations are based on participant
earnings or account balances, as defined. The Company pays administrative
expenses and fees of the Ford Stock Fund and the management fees of Common
Stock Index Fund and Bond Index Fund. All other fees and expenses are
deducted from participant account funds. The fees charged to individual
participant account fund assets totaled approximately $48,000 for the
year ended December 30, 2002. The benefit to which a participant is
entitled is the benefit that can be provided from the participant's vested
account.
4
Ford Motor Company Tax-Efficient
Savings Plan for Hourly Employees
Notes to Financial Statements
December 30, 2002 and 2001
--------------------------------------------------------------------------------
Distributions
Plan assets may not be withdrawn by participants until the termination of
their employment or until they reach 59-1/2, except in the case of personal
financial hardship. At any time or from time to time prior to termination
of employment, a member may withdraw all or part of the cash value of
assets in his or her after-tax savings account that are attributable to his
or her after-tax savings contributions and earnings thereon.
Investment Options and Participation
Participant contributions are invested in accordance with the participant's
election in one or more investment options. A variety of investment
options are available to the participants such as guaranteed investment
contract, mutual funds, common and commingled stock.
Transfers of Assets
The Plan permits the transfer of assets among investment options.
Participant Loans
The Plan permits loans to participants from both their Pre-Tax and
After-Tax Program accounts. Monthly loan interest rates are based on the
prime rate published in The Wall Street Journal.
A participant is eligible to take out one loan per calendar year, and to
have only four loans outstanding at any one time. Regular loans may be for
a minimum of one year, but not exceeding five years. Home loans may be for
a minimum of one year, but not exceeding ten years.
Investment Contracts with Insurance Companies
During 2002 and 2001, the Plan held two benefit-responsive investment
contracts with various insurance companies. The contracts are included in
the financial statements at their contract values as reported to the Plan
by the insurance companies. There is no immediate recognition of investment
gains and losses on the fixed income securities. Instead, the gain
or loss is recognized over time by adjusting the interest rate credited
to the fund under the contracts.
There were no reserves against contract value for credit risk of the
contract issuer or otherwise during 2002. The average yield and
crediting interest rate was approximately 6.05 percent for 2002. The
crediting interest rate is based on a formula agreed upon with the issuer,
but may not be less than 0 percent. Such interest rates are reviewed on
an annual basis for resetting.
Related-Party Transactions
Certain Plan investments are shares of mutual funds managed by Fidelity
Management & Research Company. Fidelity Management Trust Company is the
trustee as defined by the Plan and, therefore, these transactions
qualify as party-in-interest transactions. Certain Plan administrative
expenses and investment management service fees are paid by Ford Motor
Company. Investment management service fees paid by Ford Motor Company
amounted to $1,847,807 in 2002.
5
Ford Motor Company Tax-Efficient
Savings Plan for Hourly Employees
Notes to Financial Statements
December 30, 2002 and 2001
--------------------------------------------------------------------------------
2. Summary of Significant Accounting Policies
Basis of Accounting
The financial statements of the Plan are prepared under the accrual method
of accounting.
Investments
The investment in the Ford Stock Fund and the investments in all other
funds, except the Interest Income Fund, are valued on the basis of quoted
year-end market prices. The Interest Income Fund is stated at contract
value, which approximates fair value. Contract value represents
contributions made under the contracts, plus interest at the contract,
less funds to pay benefits and administrative expenses charged by the
Wrap Providers. Participant loans are valued at cost, which approximates
fair value.
Purchases and sales of investments are reflected on a trade-date basis. The
Plan presents in the statement of changes in net assets available for
benefits the net appreciation (depreciation) in the fair value of its
investments which consists of the Plan's realized gains or losses and the
unrealized appreciation (depreciation) on those investments.
Dividend income is recorded on the ex-dividend date. Income from other
investments is recorded as earned on an accrual basis.
Contributions
Contributions to the Plan from employees are recorded in the period that
payroll deductions are made from plan participants.
Payment of Benefits
Benefits are recorded when paid.
Use of Estimates in the Preparation of Financial Statements
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported
amounts of additions and deductions during the reporting period. Actual
results could differ from those estimates.
Risks and Uncertainties
The Plan's invested assets ultimately consist of common stock, fixed income
securities, mutual funds and other investment securities. Investment
securities are exposed to various risks, such as interest rate, market and
credit. Due to the level of risk associated with certain investment
securities and the level of uncertainty related to changes in the value of
investment securities, it is at least reasonably possible that changes in
risks in the near term would materially affect participants' account
balances and the amounts reported in the statement of net assets available
for benefits and the statement of changes in net assets available for
benefits.
6
Ford Motor Company Tax-Efficient
Savings Plan for Hourly Employees
Notes to Financial Statements
December 30, 2002 and 2001
--------------------------------------------------------------------------------
3. Investments
The following present investments that represent 5 percent or more of the
Plan's net assets:
December 30, December 30,
2002 2001
Shares Market value Shares Market value
Interest Income Fund 825,530,507 $ 825,530,507 743,121,664 $ 743,121,664
Ford Stock Fund 325,482,615 1,132,679,500 256,877,796 1,591,810,482
Common Stock Index Fund 4,566,817 212,950,687 4,735,038 271,676,231
Participant loans 216,889,042 216,889,042 232,788,943 232,788,943
During 2002, the Plan's investments depreciated in value by $899,645,033 as
follows:
Mutual funds $ 56,368,332
Ford common stock 661,034,867
Common and commingled trust funds 182,241,834
-------------------
$ 899,645,033
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4. Plan Amendment
Effective April 1, 2002, the Plan was amended to increase the amount an
employee is able to contribute from 25 percent of eligible wages to 40
percent of eligible wages, subject to Internal Revenue Service limits.
5. Tax Status
The Internal Revenue Service ("IRS") has determined and informed the
Company by letter dated January 26, 1995, that the Plan and the related
trust are designed in accordance with applicable sections of the Internal
Revenue Code (the "Code"). The Plan has since been amended, and the Plan
sponsor has applied for an updated IRS letter. The Plan sponsor and tax
counsel believe that the Plan is currently designed and being operated in
compliance with the Code. Therefore, no provision for income taxes has been
included in the Plan's financial statements.
6. Administration of Plan Assets
The Plan's assets are held by the Trustee of the Plan, Fidelity Management
Trust Company.
Certain administrative functions are performed by officers or employees of
the Company or its subsidiaries. No such officer or employee receives
compensation from the Plan.
7
Ford Motor Company Tax-Efficient
Savings Plan for Hourly Employees
Notes to Financial Statements
December 30, 2002 and 2001
--------------------------------------------------------------------------------
7. Plan Termination
The Company, by action of the Board of Directors, may terminate the Plan at
any time. Termination of the Plan would not affect the rights of a
participant as to the continuance of investment, distribution or withdrawal
of the securities, cash and cash value of the Ford Stock Fund units in the
account of the participant as of the effective date of such termination.
In the event of termination, all loans would become due immediately upon
such termination. There are currently no plans to terminate the Plan.
8
Ford Motor Company Tax-Efficient Supplemental Schedule I
Savings Plan for Hourly Employees Page 1 of 2
Schedule of Assets Held at End of Year
As of December 30, 2002
--------------------------------------------------------------------------------
(a) (b) (c) (d) (e)
Description of Investment
Identity of Issuer, Including Maturity Date,
Lessor, Borrower or Rate of Interest, Collateral,
Similar Party Par or Maturity Value Cost** Current Value
Interest Income Fund
* Fidelity Investments Interest Income Fund, 825,530,507 units
CDC Financial Products, 6.13%, due 5/15/03 $ 3,022,578
GE Life and Annuity ASR, 6.26%, due 3/17/03 2,379,586
Other 820,128,343
-----------------
Total Interest Income Fund 825,530,507
Investment Funds
* Fidelity Investments Fidelity Fund, 573,009 units 12,760,902
* Fidelity Investments Fidelity Puritan, 335,397 units 5,285,864
* Fidelity Investments Fidelity Trend, 23,979 units 925,352
* Fidelity Investments Fidelity Magellan, 1,264,292 units 99,651,465
* Fidelity Investments Fidelity Contrafund, 2,509,716 units 96,598,964
* Fidelity Investments Fidelity Equity-Income Fund, 531,826 units 21,033,719
* Fidelity Investments Fidelity Growth Company Fund, 1,423,012 units 50,317,721
* Fidelity Investments Fidelity Investment Grade Bond Fund, 621,443 units 4,704,323
* Fidelity Investments Fidelity Growth & Income Portfolio, 1,255,002 units 38,051,673
* Fidelity Investments Fidelity Value Fund, 262,950 units 12,124,642
* Fidelity Investments Fidelity Government Income Fund, 386,236 units 4,055,476
* Fidelity Investments Fidelity Retirement Growth Fund, 814,233 units 10,633,878
* Fidelity Investments Fidelity Overseas Fund, 309,199 units 6,771,447
* Fidelity Investments Fidelity Europe Fund, 118,789 units 2,165,520
* Fidelity Investments Fidelity Pacific Basin Fund, 96,675 units 1,233,567
* Fidelity Investments Fidelity Real Estate Investment Portfolio Fund,
994,121 units 18,252,068
* Fidelity Investments Fidelity Balanced Fund, 248,892 units 3,295,326
* Fidelity Investments Fidelity International Growth & Income Fund,
95,892 units 1,605,232
* Fidelity Investments Fidelity Capital Appreciation Fund, 423,303 units 6,802,480
* Fidelity Investments Fidelity Canada Fund, 40,703 units 735,505
* Fidelity Investments Fidelity Utilities Fund, 391,637 units 3,783,212
* Fidelity Investments Fidelity Asset Manager, 353,588 units 4,872,449
* Fidelity Investments Fidelity Worldwide Fund, 165,189 units 1,955,838
* Fidelity Investments Fidelity Stock Selector, 282,413 units 4,676,752
* Fidelity Investments Fidelity Asset Manager Growth, 414,969 units 4,954,729
* Fidelity Investments Fidelity Asset Manager Income, 157,146 units 1,706,603
* Fidelity Investments Fidelity Dividend Growth Fund, 2,411,716 units 53,636,564
* Fidelity Investments Fidelity New Markets Income Fund, 389,180 units 4,401,631
* Fidelity Investments Fidelity Global Balanced Fund, 19,024 units 280,605
* Fidelity Investments Fidelity Small Capital Selector Fund, 418,947 units 5,551,047
* Fidelity Investments Fidelity Freedom Income Fund, 139,090 units 1,474,357
* Fidelity Investments Fidelity Freedom 2000 Fund, 144,526 units 1,591,232
* Fidelity Investments Fidelity Freedom 2010 Fund, 871,515 units 9,970,135
* Fidelity Investments Fidelity Freedom 2020 Fund, 631,938 units 6,723,824
* Fidelity Investments Fidelity Freedom 2030 Fund, 244,259 units 2,498,773
* Fidelity Investments Fidelity Freedom 2040 Fund, 70,803 units 414,200
* Fidelity Investments EQ Index T, 29,187 units 192,345
* Fidelity Investments T. Rowe Price Spectrum Growth Fund, 134,590 units 1,491,253
* Fidelity Investments Scudder International Fund, 53,853 units 1,625,270
9
Ford Motor Company Tax-Efficient Supplemental Schedule I
Savings Plan for Hourly Employees Page 2 of 2
Schedule of Assets Held at End of Year
As of December 30, 2002
--------------------------------------------------------------------------------
(a) (b) (c) (d) (e)
Description of Investment
Identity of Issuer, Including Maturity Date,
Lessor, Borrower or Rate of Interest, Collateral,
Similar Party Par or Maturity Value Cost** Current Value
* Fidelity Investments Vanguard LifeStrategy Conservative Growth Fund,
48,331 units 619,598
* Fidelity Investments Domini Social Equity Fund, 39,738 units 858,735
* Fidelity Investments Val EQ A, 88,964 units 1,103,150
* Fidelity Investments T. Rowe Price Spectrum Income Fund, 86,723 units 933,136
* Fidelity Investments Vanguard LifeStrategy Moderate Growth Fund,
100,975 units 1,398,498
* Fidelity Investments T. Rowe Price New Horizons Funds, 502,687 units 8,304,386
* Fidelity Investments Scudder Global Fund, 37,704 units 670,385
* Fidelity Investments Vanguard LifeStrategy Growth Fund, 151,218 units 2,166,956
* Fidelity Investments T. Rowe Price International Stock Fund, 290,180
units 2,559,391
* Fidelity Investments Scudder Global Discovery Fund, 67,711 units 1,257,394
* Fidelity Investments T. Rowe Price International Discovery Fund, 280,530
units 4,488,477
* Fidelity Investments Scudder Income Fund, 95,253 units 1,220,187
* Fidelity Investments T. Rowe Price New Asia Fund, 316,961 units 1,762,304
* Fidelity Investments Scudder Growth & Income Fund, 227,650 units 3,642,401
* Fidelity Investments T. Rowe Price High Yield Fund, 942,139 units 5,907,213
* Fidelity Investments Scudder Greater Europe Growth Fund, 309,705 units 5,528,232
* Fidelity Investments T. Rowe Price New Era Fund, 76,400 units 1,571,552
* Fidelity Investments Scudder Japan Fund, 251,085 units 1,526,596
* Fidelity Investments Vanguard International Value Fund, 37,069 units 691,705
* Fidelity Investments T. Rowe Price Latin America Fund, 218,976 units 1,635,753
* Fidelity Investments Pimco, 745,020 units 7,949,360
* Fidelity Investments INVESCO Dynamics Fund, 112,972 units 1,202,020
* Fidelity Investments Templeton Foreign Fund, 273,443 units 2,261,374
* Fidelity Investments Neurberger Berman Genesis Investors Fund, 517,599
units 10,160,477
* Fidelity Investments Oakmark Select Fund, 1,003,794 units 23,809,987
* Fidelity Investments Pimco real rtn, 680,347 units 7,633,489
* Fidelity Investments Janus Aspen International Growth Portfolio,
59,130 units 1,017,044
* Fidelity Investments Janus Aspen Growth Portfolio, 72,032 units 1,045,898
* Fidelity Investments Vanguard Value Index Fund, 230,158 units 3,360,312
* Fidelity Investments Vanguard Growth Index Investment Fund, 718,859
units 14,369,999
* Fidelity Investments Citizens Glbl Eq Ins, 26,674 units 344,629
Fidelity Investments Vanguard Investment Index Plus Fund, 779,046 units 62,635,260
* Fidelity Investments Royce Low-Priced Stock Fund, 1,377,937 units 13,379,764
* Fidelity Investments Vanguard Explorer Fund, 210,391 units 8,849,027
* Fidelity Investments Bond Index Fund, 1,771,889 units 35,880,741
* Fidelity Investments Common Stock Index Fund, 4,566,817 units 212,950,687
* Fidelity Investments US Extended Mkt IDX, 148,889 units 1,182,182
* Fidelity Investments Ford Stock Fund, 325,482,615 units 1,132,679,500
------------------
Total Investment Funds 2,097,363,742
Participant Loans
* Participant Loans Participant loans, interest rates varying from
4.75 to 9.5% 216,889,042
------------------
Total investments $ 3,139,783,291
------------------
*Denotes party-in-interest
** Not required per Department of Labor 29 CFR 2520.103-10.
10