Exhibit 12
Ford Motor Company and Subsidiaries
CALCULATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
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(in millions)
Nine For the Years Ended December 31
Months ------------------------------------------------------------
1998 1997 1996 1995 1994 1993
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Earnings
Income before income taxes $23,798 $10,939 $ 6,793 $ 6,705 $ 8,789 $ 4,003
Equity in net (income)/loss of affiliates
plus dividends from affiliates 9 121 36 179 (182) (98)
Adjusted fixed charges a/ 6,899 10,911 10,801 10,556 8,122 7,648
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Earnings $30,706 $21,971 $17,630 $17,440 $16,729 $11,553
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Combined Fixed Charges and
Preferred Stock Dividends
Interest expense b/ $ 6,669 $10,570 $10,464 $10,121 $ 7,787 $ 7,351
Interest portion of rental expense c/ 191 309 300 396 265 266
Preferred stock dividend requirements of
majority owned subsidiaries and trusts d/ 41 55 55 199 160 115
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Fixed charges 6,901 10,934 10,819 10,716 8,212 7,732
Ford preferred stock dividend requirements e/ 116 82 95 459 472 442
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Total combined fixed charges
and preferred stock dividends $ 7,017 $11,016 $10,914 $11,175 $ 8,684 $ 8,174
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Ratios
Ratio of earnings to fixed charges 4.4 f/ 2.0 1.6 1.6 2.0 1.5
Ratio of earnings to combined fixed
charges and preferred stock dividends 4.4 f/ 2.0 1.6 1.6 1.9 1.4
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a/ Fixed charges, as shown below, adjusted to exclude the amount of interest
capitalized during the period and preferred stock dividend requirements of
majority owned subsidiaries.
b/ Includes interest, whether expensed or capitalized, and amortization of debt
expense and discount or premium relating to any indebtedness.
c/ One-third of all rental expense is deemed to be interest.
d/ Preferred stock dividend requirements of Ford Holdings, Inc. (applicable for
1993 through 1995) increased to an amount representing the pre-tax earnings
which would be required to cover such dividend requirements based on Ford's
effective income tax rates. Beginning in Fourth Quarter 1995, includes
requirements related to Company-obligated mandatorily redeemable preferred
securities of a subsidiary trust.
e/ Preferred stock dividend requirements of Ford Motor Company, increased to an
amount representing the pre-tax earnings which would be required to cover
such dividend requirements based on Ford's effective income tax rates.
f/ Earnings used in calculation of this ratio include the $15,955 million gain
on the spin-off of The Associates. Excluding this gain, the ratio is 2.1.