Ford CEO Alan Mulally testifies on Capitol Hill

Today, Ford President and CEO Alan Mulally testified before the Senate Committee on Banking, Housing and Urban Affairs.

"Mr. Chairman, Senator Shelby, and members of the Committee. Since the last hearing, I have thought a great deal about the concerns you expressed. I want you to know I heard your message loud and clear.

On Tuesday, you received Ford's detailed and comprehensive business plan, and I appreciate the opportunity to return here today to share Ford’s vision and progress in becoming a profitable, growing company.

You were clear that our business model needs to change. I agree. And that's exactly why I came to Ford two years ago to join Bill Ford in implementing his vision to transform our company and build a greener future using advanced technology. Let me share with you what we have done to change from how we used to do business to how we do business now.

It used to be that we had too many brands. Now we have a laser focus on our most important brand: the Ford blue oval. In the last two years, we sold Aston Martin, Jaguar and Land Rover – and reduced our investment in Mazda. And this week, we announced we are considering a sale of Volvo.

It used to be that our approach to our customers was: If you build it, they will come. We produced more vehicles than our customers wanted and then slashed prices, hurting the residual values of those vehicles and hurting our customers. Now we are aggressively matching production to meet the true customer demand.

It used to be that we focused heavily on trucks and SUVs. Now we are shifting to a balanced product portfolio, with even more focus on small cars and the advanced technologies that will drive higher fuel economy in all of our vehicles.

It used to be that our labor costs made us uncompetitive. Now we have a ground-breaking agreement with the UAW to reduce labor costs, and we appreciate the UAW's continued willingness to help close the competitive gap.

It used to be that we had too many suppliers and dealers. Now we're putting in place the right structure to maximize the efficiency and the profitability for all of our partners.

It used to be that we operated regionally – European cars for Europe. Asian cars for Asia. American cars for the U.S. market. Now we are leveraging our global assets, innovation, technology, and scale to deliver world class products for every market.

It used to be that our goal was simply to compete. Now we are absolutely committed to exceeding our customers' expectations for quality, fuel-efficiency, safety and affordability.

This is the Ford story. We are more balanced. We are more efficient. We are more global. And we are focused. In short, we are on the right path to becoming a profitable, growing company.

We have moved our business model in a completely new direction, in line with the most successful companies – and competitors - around the world. And as a result of our progress, we made a profit in the first quarter of this year. Unfortunately, we all are facing a severe economic downturn that has slowed our momentum.

Despite this downturn, Ford does not anticipate a near-term liquidity crisis. In fact, we expect our automobile business to be profitable in 2011. But we do support a government bridge loan because it is critically important to the U.S. auto industry.

Specifically, Ford requests access to $9 billion in bridge financing – something we hope we will not need to use. Instead, as we continue to drive change in our company, this line of credit will serve as a critical safeguard, if events require it. And if we did need to access this loan, we would use the money to continue our aggressive transformation and restructuring.

Ford is an American company and an American icon. We are woven into the fabric of every community that relies on our cars and trucks and the jobs our company supports. The entire Ford team – from employees to shareholders, suppliers to dealers – is absolutely committed to implementing our new business model and becoming a lean, profitable company that builds the best cars and trucks on the road for our customers. There is a lot more work to do, but we are passionate about the future of Ford.

In fact, we invite you to visit us in Dearborn to kick the tires, look under the hood and talk to our employees. We hope you will join us and see for yourself the progress we are making to develop the vehicles of the future."

- Ford -