DESCRIPTION OF DIRECTOR COMPENSATION

Exhibit 10-H-3

Goal. Ford wants the directors’ compensation to be tied to their interests as
shareholders. Accordingly, 60% ($120,000) of a director’s annual Board
membership fee is deferred in the form of common stock units. This deferral,
together with director stock ownership goals, is part of Ford’s commitment to
link director and shareholder interests. These compensation programs are
described below.

Fees. The following fees are paid to directors who are not Ford employees:

           
Annual Board membership fee
  $ 200,000  
Annual Committee chair fee
  $ 5,000    
Annual presiding director fee
  $ 10,000  

Deferred Compensation Plan. Under this plan, $120,000 of a director’s annual
Board membership fee must be deferred in common stock units. Directors also can
choose to have the payment of all or some of the remainder of their fees
deferred in the form of cash and/or common stock units. Each common stock unit
is equal in value to a share of common stock and is ultimately paid in cash.
These common stock units generate Dividend Equivalents in the form of additional
common stock units. These units are credited to the directors’ accounts on the
date common stock cash dividends are paid. Any fees deferred in cash are held in
the general funds of the Company. Interest on fees deferred in cash is credited
semi-annually to the directors’ accounts at the then-current U.S. Treasury Bill
rate plus 0.75%. In general, deferred amounts are not paid until after the
director retires from the Board. The amounts are then paid, at the director’s
option, either in a lump sum or in annual installments over a period of up to
ten years.

Restricted Stock Plan. Effective as of July 1, 2004, the Restricted Stock Plan
for Non-Employee Directors was terminated, except for then outstanding grants of
restricted stock and stock equivalents.

Life Insurance. Ford provides non-employee directors with $200,000 of life
insurance and $500,000 of accidental death or dismemberment coverage. The life
insurance coverage continues after the director retires from the Board if the
director is at least 55 years old and has served for at least five years. A
director who retires from the Board after age 70 or, after age 55 with Board
approval, and who has served for at least five years, may elect to have the life
insurance reduced to $100,000 and receive $15,000 a year for life. The
accidental death or dismemberment coverage may, at the director’s expense, be
supplemented up to an additional $500,000 and ends when the director retires
from the Board.

Matching Gift Program and Vehicle Evaluation Program. Non-employee directors may
give up to $25,000 per year to certain tax-exempt organizations under the Ford
Fund Matching Gift Program. For each dollar given, the Ford Motor Company Fund
contributes two dollars. The Company also provides directors with the use of
company vehicles at an estimated aggregate value in 2004 of $27,500 per
director. The directors are expected to provide evaluations of the vehicles to
the Company.