FORD'S LOSS A WHOPPING $7.4 BILLION

                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: THURSDAY, February 11, 1993                   TAG: 9302110100
SECTION: BUSINESS                    PAGE: C6   EDITION: METRO 
SOURCE: Knight-Ridder/Tribune
DATELINE: DEARBORN, MICH.                                LENGTH: Medium
FORD'S LOSS A WHOPPING $7.4 BILLION
Ford Motor Co. lost a record $7.4 billion in 1992, largely the result of a required bookkeeping change to more accurately reflect the massive cost of retiree health benefits.
The staggering loss, which amounted to $15.61 per share, overshadowed Ford's significant improvement in automotive operations during 1992.
The loss was the largest ever for a U.S. corporation, although it won't hold that distinction for long. General Motors Corp. is expected to report a $23 billion loss today.
The figures, while reducing the companies' net worths and providing investors with a better idea of the carmakers' long-term finances, don't affect their cash flow.
Instead, they represent the effect of complying with new accounting standards that require companies to report the future cost of retiree health benefits now rather than when those bills are paid.
GM and Ford, like most companies, have grossly understated the value of these benefits in the past. Now, through one-time charges, they are playing catch-up.
Ford subtracted $7.5 billion from its bottom line to cover the bookkeeping change for retiree health care. It also adopted a new accounting standard for income taxes, which added $657 million to the bottom line.
Without these one-time charges, the 1992 loss would have been $502 million, or $1.46 per share, compared with a 1991 loss of $2.3 billion, or $4.79 per share.
Ford's financial services businesses had a record year, posting profits of $1.03 billion, up 11 percent from 1991, excluding the one-time charges.
Ford's U.S. automotive operations improved significantly in 1992 as its market share grew to 24.7 percent, up 1.5 percentage points from 1991. Excluding one-time charges, Ford broke even on its U.S. operations in 1992 and expects to post a profit on them this year, said David McCammon, vice president of finance and treasurer.
"No matter how you slice it, we had a big improvement in 1992, particularly in our U.S. operations," he said.

by Archana Subramaniam by CNB