COLOGNE, Germany, 12 May, 2000 - Ford and Getrag have signed a letter of intent to form a 50:50 joint venture for the engineering and manufacture of manual transmissions in Europe.

Announced as part of Ford of Europe's business review strategy, the joint venture company would take ownership of existing Ford manual transmission plants at Bordeaux in France, Cologne in Germany and Halewood in the UK. Manual Transmission Operations at Ford's Engineering Centre in Merkenich, Germany would also transfer to the joint venture. All current employees at these facilities, who move to the joint venture, can remain Ford employees.

Subject to the completion of negotiations, the new joint venture company is expected to begin operation in the fourth quarter of 2000. It would continue to produce the IB5, MT75, MTX75 and VXT75 transmissions currently used in all European Ford vehicles. Further investment would be committed to develop and produce new transmission products for Ford and other vehicle manufacturers, subject to any appropriate Government grants being negotiated.

"This is an outstanding business proposition for Ford," said David Thursfield, President of Ford of Europe. "Joining with a highly respected partner creates an opportunity to take the Ford manual transmission business forward with fresh momentum, opening up the prospect of innovative new products and future growth through sales to other vehicle manufacturers."

Tobias Hagenmeyer, President and Chief Executive Officer of Getrag GmbH, commented: "The joint venture offers Getrag a great opportunity for substantial growth enabling us to become a significant presence in the rapidly consolidating automotive industry, while maintaining our independence as a global automotive supplier. With the joint venture we are pursuing the goal of driving forward the joint development of innovative transmission systems."

The three Ford Manual Transmission Operations plants in Europe employ 3,700 people and produced 1.72 million transmissions in 1999.

Getrag is one of the world's leading companies in the development and production of manual transmissions and supplies most of the major vehicle producers. Founded in 1935, it employs 5,000 people at 11 sites in Germany, India, Italy and the US. It has its headquarters in Ludwigsburg, Germany.