<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549


                                    FORM 10-Q


[X]      QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
         EXCHANGE ACT of 1934

         For the quarterly period ended March 31, 2006

                                       OR

[ ]      TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
         EXCHANGE ACT of 1934

         For the transition period from ______ to ______

                          COMMISSION FILE NUMBER: 0-452


                            TECUMSEH PRODUCTS COMPANY
             (Exact name of registrant as specified in its charter)

                MICHIGAN                                 38-1093240
        (State of Incorporation)            (IRS Employer Identification Number)

        100 EAST PATTERSON STREET
           TECUMSEH, MICHIGAN                               49286
(Address of Principal Executive Offices)                 (Zip Code)

               Registrant's telephone number, including area code:
                                 (517) 423-8411

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

         Yes [X] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, or
non-accelerated filer. See definition of "accelerated filer and large
accelerated filer" in Rule 12b-2 of the Exchange Act(check one):

   Large accelerated filer [ ]  Accelerated filer [X] Non-accelerated filer [ ]

Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Act).

         Yes [ ] No [X]

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

<TABLE>
<CAPTION>
               Class of Stock                               Outstanding at March 31, 2006
               --------------                               -----------------------------

<S>                                                      <C>
    Class B Common Stock, $1.00 par value                                 5,077,746
    Class A Common Stock, $1.00 par value                                13,401,938
</TABLE>


                                                                          Page 1
<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<S>                                                                                  <C>
Part I. Financial Information                                                        Page
      Item 1. Financial Statements
           Consolidated Condensed Balance Sheets ...............................      3
           Consolidated Condensed Statements of Operations .....................      4
           Consolidated Condensed Statements of Cash Flows .....................      5
           Notes to Consolidated Condensed Financial Statements ................      6
      Item 2. Management's Discussion and Analysis of Financial Condition
              and Results of Operations ........................................     16
      Item 3. Quantitative and Qualitative Disclosures About Market Risk .......     26
      Item 4. Controls and Procedures ..........................................     28
Part II. Other Information .....................................................     30
Signatures .....................................................................     32
Amendment No. 1 to First Lien Credit Agreement .................................     Exh 4.1
Amendment No. 1 to Second Lien Credit Agreement ................................     Exh 4.2
Management Incentive Plan as amended and restated on March 29, 2006 ............     Exh 10.1
Executive Deferred Compensation Plan adopted on March 29, 2006 .................     Exh 10.2
Director Retention Phantom Share Plan as amended and restated on March 29 ......     Exh 10.3
Certification of CEO Pursuant to Section 302 ...................................     Exh 31.1
Certification of CFO Pursuant to Section 302 ...................................     Exh 31.2
Certification of CEO Pursuant to Section 906 ...................................     Exh 32.1
Certification of CFO Pursuant to Section 906 ...................................     Exh 32.2
</TABLE>



                                                                          Page 2
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART I. FINANCIAL INFORMATION - ITEM 1
                      CONSOLIDATED CONDENSED BALANCE SHEETS
                                   (Unaudited)

<TABLE>
<CAPTION>
   (Dollars in millions, except share data)                                  MARCH 31,      December 31,
ASSETS                                                                         2006             2005
                                                                           ------------     ------------
<S>                                                                        <C>              <C>
Current Assets:
   Cash and cash equivalents                                               $       82.8     $      116.6
   Accounts receivable, less allowance for doubtful accounts of $10.9
     in 2006 and $11.3 in 2005                                                    232.6            211.1
   Inventories                                                                    348.4            346.8
   Deferred and recoverable income taxes                                           40.0             43.4
   Other current assets                                                            91.6             89.2
    Assets held for sale                                                           48.3               --
                                                                           ------------     ------------
         Total current assets                                                     843.7            807.1

Property, plant, and equipment, net                                               590.1            578.6
Goodwill                                                                          126.1            130.9
Other intangibles                                                                  56.0             54.8
Deferred income taxes                                                               0.5               --
Prepaid pension expense                                                           188.7            185.3
Other assets                                                                       50.8             43.8
Assets held for sale                                                               14.7               --
                                                                           ------------     ------------
         Total assets                                                      $    1,870.6     $    1,800.5
                                                                           ============     ============

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
   Accounts payable, trade                                                 $      201.7     $      187.3
   Income taxes payable                                                             2.3               --
   Short-term borrowings                                                          121.2             82.5
   Accrued liabilities                                                            133.7            135.3
   Liabilities held for sale                                                       15.0               --
                                                                           ------------     ------------
         Total current liabilities                                                473.9            405.1

Long-term debt                                                                    281.8            283.0
Deferred income taxes                                                              16.8             25.0
Other postretirement benefit liabilities                                          210.6            210.9
Product warranty and self-insured risks                                            12.6             14.5
Pension liabilities                                                                15.4             15.2
Other non-current liabilities                                                      36.3             32.4
                                                                           ------------     ------------
         Total liabilities                                                      1,047.4            986.1
                                                                           ------------     ------------
Commitments and contingencies
Stockholders' Equity
   Class A common stock, $1 par value; authorized 75,000,000 shares;
     issued and outstanding 13,401,938 shares in 2005 and 2004                     13.4             13.4
   Class B common stock, $1 par value; authorized 25,000,000 shares;
     issued and outstanding 5,077,746 shares in 2005 and 2004                       5.1              5.1
   Retained earnings                                                              797.1            806.6
   Accumulated other comprehensive income (loss)                                    7.6            (10.7)
                                                                           ------------     ------------
         Total stockholders' equity                                               823.2            814.4
                                                                           ------------     ------------
         Total liabilities and stockholders' equity                        $    1,870.6     $    1,800.5
                                                                           ============     ============
</TABLE>

   The accompanying notes are an integral part of these Consolidated Condensed
                              Financial Statements.


                                                                          Page 3
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART I. FINANCIAL INFORMATION - ITEM 1
                 CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                            THREE MONTHS ENDED
  (Dollars in millions, except per share data)                                   MARCH 31,
                                                                           2006              2005
                                                                       ------------      ------------
<S>                                                                    <C>               <C>

Net sales                                                              $      446.1      $      440.2
   Cost of sales and operating expenses                                       411.6             412.7
   Selling and administrative expenses                                         45.2              43.4
   Impairments, restructuring charges, and other items                          0.6               0.1
                                                                       ------------      ------------
Operating loss                                                                (11.3)            (16.0)
   Interest expense                                                            (8.4)             (6.3)
   Interest income and other, net                                               5.0               3.3
                                                                       ------------      ------------
Loss from continuing operations before taxes                                  (14.7)            (19.0)
   Tax benefit                                                                 (5.6)             (6.5)
                                                                       ------------      ------------
   Loss from continuing operations                                             (9.1)            (12.5)
   Income (Loss) from discontinued operations, net of tax                      (0.5)              0.1
                                                                       ------------      ------------
Net loss                                                               $       (9.6)     $      (12.4)
                                                                       ============      ============

Basic and diluted earnings (loss) per share
   Loss from continuing operations                                     $      (0.49)     $      (0.68)
   Income (Loss) from discontinued operations, net of tax              $      (0.03)     $       0.01
                                                                       ------------      ------------
Net loss                                                               $      (0.52)     $      (0.67)
                                                                       ============      ============

Weighted average shares (in thousands)                                       18,480            18,480
                                                                       ------------      ------------

Cash dividends declared per share                                      $       0.00      $       0.32
                                                                       ------------      ------------
</TABLE>

        The accompanying notes are an integral part of these Consolidated
                         Condensed Financial Statements.


                                                                          Page 4
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART I. FINANCIAL INFORMATION - ITEM 1
                 CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                             THREE MONTHS ENDED
  (Dollars in millions)                                                          MARCH 31,
                                                                           2006              2005
                                                                       ------------      ------------
<S>                                                                    <C>               <C>
Cash Flows from Operating Activities:
                  Cash used by operating activities                    $      (44.5)     $      (67.4)

Cash Flows from Investing Activities:
   Proceeds from sale of assets                                                 9.0                --
   Capital expenditures                                                       (20.0)            (28.7)
   Business acquisition                                                        (2.0)               --
                                                                       ------------      ------------
                  Cash used in investing activities                           (13.0)            (28.7)
                                                                       ------------      ------------

Cash Flows from Financing Activities:
   Dividends paid                                                                --              (5.9)
   Repayment of Senior Guaranteed Notes                                      (250.0)            (50.0)
   Repayment of Industrial Development Revenue Bonds                          (10.5)               --
   Proceeds from First Lien Credit Agreement                                  168.3                --
   Proceeds from Second Lien Credit Agreement                                 100.0                --
   Other proceeds (repayments), net                                            16.2               8.5
                                                                       ------------      ------------
                  Cash provided by (used in) financing activities              24.0             (47.4)
                                                                       ------------      ------------

Effect of exchange rate changes on cash                                        (0.3)              1.1
                                                                       ------------      ------------

   Decrease in cash and cash equivalents                                      (33.8)           (142.4)

Cash and Cash Equivalents:
                  Beginning of period                                         116.6             227.9
                                                                       ------------      ------------
                  End of period                                        $       82.8      $       85.5
                                                                       ============      ============
</TABLE>


        The accompanying notes are an integral part of these Consolidated
                         Condensed Financial Statements.


                                                                          Page 5
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 1
              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                   (Unaudited)

1.   The consolidated condensed financial statements of Tecumseh Products
     Company and Subsidiaries (the "Company") are unaudited and reflect all
     adjustments (including normal recurring adjustments) which are, in the
     opinion of management, necessary for a fair statement of the financial
     position and operating results for the interim periods. The December 31,
     2005 condensed balance sheet data was derived from audited financial
     statements, but does not include all disclosures required by generally
     accepted accounting principles in the United States ("U.S. GAAP"). The
     consolidated condensed financial statements should be read in conjunction
     with the consolidated financial statements and notes thereto contained in
     the Company's Annual Report for the fiscal year ended December 31, 2005.
     Due to the seasonal nature of the Company's business, the results of
     operations for the interim period are not necessarily indicative of the
     results for the entire fiscal year.

2.   Comprehensive Income

<TABLE>
<CAPTION>
     (Dollars in millions)                                             THREE MONTHS ENDED
                                                                           MARCH 31,
                                                                     2006              2005
                                                                 ------------      ------------
<S>                                                              <C>               <C>
     Net loss                                                    $       (9.6)     $      (12.4)
     Other comprehensive income (loss):
        Foreign currency translation adjustments                 $       23.2              (6.5)
        Gain (Loss) on derivatives                                       (0.9)              3.9
        Unrealized gain (loss) on investment holdings                    (3.9)              3.8
                                                                 ------------      ------------

     Total comprehensive income (loss)                           $        8.8      $      (11.2)
                                                                 ============      ============
</TABLE>

3.    Inventories

<TABLE>
<CAPTION>
                                                                   MARCH 31,       DECEMBER 31,
     (Dollars in millions)                                           2006              2005
                                                                 ------------      ------------
<S>                                                              <C>               <C>
     Raw material                                                $      123.2      $      128.5
     Work in progress                                                    84.5              73.3
     Finished goods                                                     132.4             136.7
     Supplies                                                             8.3               8.3
                                                                 ------------      ------------

     Total inventories                                           $      348.4      $      346.8
                                                                 ============      ============
</TABLE>



                                                                          Page 6
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 1
              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                   (Unaudited)


4.   Business Segments

     The Company has three reportable segments based on the criteria set forth
     in SFAS No. 131 "Disclosures about Segments of an Enterprise and Related
     Information": Compressor Products, Electrical Component Products, and
     Engine & Power Train Products. Previously, the Company also reported a Pump
     Products business segment; however, as a result of the decision, during the
     first quarter of 2006, to sell 100% of its ownership in Little Giant Pump
     Company, such operations are no longer reported in loss from continuing
     operations before tax. Little Giant operations represented approximately
     90% of that previously reported segment. Since the Company's remaining pump
     business does not meet the definition of a reporting segment as defined by
     SFAS No. 131, "Segment Reporting," the Company will no longer report a Pump
     Products segment, and operating results of the remaining pump business are
     included in Other for segment reporting purposes. Revenues and operating
     income by segment for the periods indicated are as follows:

<TABLE>
<CAPTION>
      BUSINESS SEGMENT DATA                                            THREE MONTHS ENDED
       (Dollars in millions)                                               MARCH 31,
                                                                     2006              2005
                                                                 ------------      ------------
<S>                                                              <C>               <C>

     Net sales:
        Compressor Products                                      $      251.5      $      241.0
        Electrical Component Products                                   109.1             100.2
        Engine & Power Train Products                                    80.9              94.9
        Other (a)                                                         4.6               4.1
                                                                 ------------      ------------
               Total Net Sales                                   $      446.1      $      440.2
                                                                 ============      ============

     Operating income (loss):
        Compressor Products                                      $        6.6      $        8.6
        Electrical Component Products                                     4.9              (1.1)
        Engine & Power Train Products                                   (18.5)            (20.9)
        Other (a)                                                         0.3              (0.2)
        Corporate expenses                                               (4.0)             (2.3)
        Impairments, restructuring charges, and other items              (0.6)             (0.1)
                                                                 ------------      ------------
               Total operating loss from continuing operations          (11.3)            (16.0)
        Interest expense                                                 (8.4)             (6.3)
        Interest income and other, net                                    5.0               3.3
                                                                 ------------      ------------
        Loss from continuing operations before taxes             $      (14.7)     $      (19.0)
                                                                 ============      ============
</TABLE>

     (a)  "Other" consists of non-reportable business segments.

     The Electrical Component Products segment had inter-segment sales of $11.9
     million and $16.7 million in the first quarter of 2006 and 2005,
     respectively.


                                                                          Page 7
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 1
              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                   (Unaudited)


5.   Goodwill and Other Intangible Assets

     At March 31, 2006, goodwill by segment consisted of the following:

<TABLE>
<CAPTION>
                                                                     ELECTRICAL
                                                   COMPRESSOR        COMPONENTS          PUMPS            TOTAL
                                                  ------------      ------------      ------------     ------------
<S>                                               <C>               <C>               <C>              <C>
     Balance at 1/1/2006                          $       16.9      $      108.9      $        5.1     $      130.9
       Reclassified to held for sale                                                          (5.1)            (5.1)
       Foreign Currency Translation                        0.3                                                  0.3
                                                  ------------      ------------      ------------     ------------
     Balance at 3/31/2006                         $       17.2      $      108.9      $        0.0     $      126.1
                                                  ============      ============      ============     ============
</TABLE>

     Other intangible assets consisted of the following:

<TABLE>
<CAPTION>
                                                               GROSS
                                                              CARRYING       ACCUMULATED                        AMORTIZABLE
                                                               AMOUNT        AMORTIZATION         NET              LIFE
                                                            ------------     ------------     ------------     ------------
<S>                                                         <C>              <C>              <C>             <C>
     Intangible assets subject to amortization:
              Customer relationships and contracts          $       39.3     $        8.6     $       30.7       6-15 years
              Technology                                            12.0              3.6              8.4       5-10 years
                                                            ------------     ------------     ------------
                  Total                                             51.3             12.2             39.1
     Intangible assets not subject to amortization:
              Trade name                                            16.9               --             16.9
                                                            ------------     ------------     ------------
     Total intangible assets                                $       68.2     $       12.2     $       56.0
                                                            ============     ============     ============
</TABLE>

     The estimated amortization expense over the next five years is $4.2 million
     for 2006 through 2008 and approximately $3.9 million annually for 2009
     through 2010. Amortization expense for the three months ended March 31 was
     $0.9 million and $1.3 million for 2006 and 2005, respectively.

     As a result of the acquisition of In Motion Technologies Pty. Ltd. (IMT),
     the Company recorded an additional technology intangible assets of $2.0
     million during the quarter.



                                                                          Page 8
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 1
              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                   (Unaudited)


6.   Pension and Other Postretirement Benefit Plans

     Components of net periodic benefit (income) cost are as follows:

<TABLE>
<CAPTION>
                                                             PENSION BENEFITS                    OTHER BENEFITS
                                                      ------------------------------      ------------------------------
                                                            THREE MONTHS ENDED                  THREE MONTHS ENDED
                                                                MARCH 31,                           MARCH 31,
                                                          2006              2005              2006              2005
                                                      ------------      ------------      ------------      ------------
<S>                                                   <C>               <C>               <C>               <C>

     Service Cost                                     $        2.4      $        2.1      $        0.8      $        1.1
     Interest Cost                                             5.3               5.1               2.4               2.6
     Expected return on plan assets                          (11.1)            (10.0)               --                --
     Amortization of prior service costs                       0.1               0.1              (1.2)             (0.3)
     Amortization of net gain                                   --              (0.6)               --              (0.7)
                                                      ------------      ------------      ------------      ------------
     Net periodic benefit (income) cost               $       (3.3)     $       (3.3)     $        2.0      $        2.7
                                                      ============      ============      ============      ============
</TABLE>

     During the second quarter of 2005, the Company announced some changes to
     certain of its retiree medical benefits. Included among these changes were
     plans to phase in retiree contributions and raise plan deductibles (both as
     of January 1, 2006). The Company also implemented plans to eliminate
     Post-65 prescription drug benefits starting January 1, 2008 and discontinue
     all retiree medical benefits for anyone hired after January 1, 2006.

     The Company does not expect to contribute to its pension plans in 2006.

7.   Guarantees and Warranties

     A portion of accounts receivable at the Company's Brazilian subsidiary are
     sold with recourse. Brazilian receivables sold at March 31, 2006 and
     December 31, 2005 were $35.2 million and $32.1 million, respectively. The
     Company estimates the fair value of the contingent liability related to
     these receivables to be $0.5 million, which is included in operating income
     and allowance for doubtful accounts.



                                                                          Page 9
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 1
              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                   (Unaudited)


      A provision for estimated future warranty costs and estimated returns for
      credit relating to warranty are recorded when products are sold and
      revenue recognized. A reconciliation of the changes in the Company's
      product warranty liability follows:

<TABLE>
<CAPTION>
                                                              Three Months Ended   Three Months Ended
    (Dollars in millions)                                       March 31, 2006       March 31, 2005
                                                              ------------------   ------------------
<S>                                                           <C>                  <C>
     Balance at January 1, 2006                                  $       29.4         $       38.1
        Accruals for warranties                                           4.3                  2.6
        Settlements made (in cash or in kind)                            (4.4)                (5.5)
        Effect of foreign currency translation                            0.2                 (0.3)
        Reclassification to held for sale                                (2.7)                  --
                                                                 ------------         ------------
     Balance at March 31, 2006                                   $       26.8         $       34.9
                                                                 ============         ============
</TABLE>

     As of March 31, 2006, $21.3 million was included in accrued liabilities and
     $5.5 million was included in product warranty and self-insured risks.

8.   Debt

     During the first quarter of 2005, the Senior Guaranteed Notes and Revolving
     Credit Facility outstanding at December 31, 2005 were replaced by a new
     financing package that included a $275 million First Lien Credit Agreement
     and a $100 million Second Lien Credit Agreement. The agreements provide for
     security interests in substantially all of the Company's assets and
     specific financial covenants related to EBITDA, capital expenditures, and
     fixed charge coverage. Additionally, under the terms of the agreements, no
     dividends can be paid prior to December 31, 2006 and minimum amounts of
     credit availability are required before dividends can be paid thereafter.
     The new arrangements bore a weighted average annual interest rate of 9.0%
     based upon outstanding balances at closing versus the rate of 6.6%
     applicable to the $250 million Senior Guaranteed Notes.

     At March 31, 2006, the Company had outstanding letters of credit of $4.8
     million. At March 31, 2006, the Company had total availability of $32.8
     million under its $275 million First Lien Credit Agreement.

     As more fully described in Note 14, subsequent to March 31, 2006, the
     Company sold Little Giant Pump Company and proceeds from the sale were used
     to repay portions of the new debt arrangements. Approximately, 63% of the
     proceeds were applied against the First Lien borrowing and 37% against the
     Second Lien borrowing. After giving affect to the repayments, the weighted
     average annual interest rate of these borrowings was 8.8%.

9.   Environmental Matters

     The Company has been named by the U.S. Environmental Protection Agency
     ("EPA") as a potentially responsible party ("PRP") in connection with the
     Sheboygan River and Harbor Superfund Site in Wisconsin. The EPA has
     indicated its intent to address the site in two phases, with the Company's
     Sheboygan Falls plant site and the upper river constituting the first phase
     ("Phase I") and the middle and lower river and harbor being the second
     phase ("Phase II"). In May



                                                                         Page 10
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 1
              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                   (Unaudited)


     2003, the Company concluded a Consent Decree with the EPA concerning the
     performance of remedial design and remedial action for Phase I, deferring
     for an unspecified period any action regarding Phase II.

     In March 2003, with the cooperation of the EPA, the Company and Pollution
     Risk Services, LLC ("PRS") entered into a Liability Transfer and Assumption
     Agreement (the "Liability Transfer Agreement"). Under the terms of the
     Liability Transfer Agreement, PRS assumed all of the Company's
     responsibilities, obligations and liabilities for remediation of the entire
     Site and the associated costs, except for certain specifically enumerated
     liabilities. Also, as required by the Liability Transfer Agreement, the
     Company has purchased Remediation Cost Cap insurance, with a 30-year term,
     in the amount of $100.0 million and Environmental Site Liability insurance
     in the amount of $20.0 million. The Company believes such insurance
     coverage will provide sufficient assurance for completion of the
     responsibilities, obligations and liabilities assumed by PRS under the
     Liability Transfer Agreement. On October 10, 2003, in conjunction with the
     Liability Transfer Agreement, the Company completed the transfer of title
     to the Sheboygan Falls, Wisconsin property to PRS.

     The total cost of the Liability Transfer Agreement to the Company,
     including the cost of the insurance policies, was $39.2 million. The
     Company recognized a charge of $13.6 million ($8.7 million net of tax) in
     the first quarter of 2003. The charge consisted of the difference between
     the cost of the Liability Transfer Agreement and amounts previously accrued
     for the cleanup. The Company continues to maintain an additional reserve of
     $0.5 million to reflect its potential environmental liability arising from
     operations at the Site, including potential residual liabilities not
     assumed by PRS pursuant to the Liability Transfer Agreement.

     As the Liability Transfer Agreement was executed prior to the signing of
     the original Consent Decree for the Phase I work, the original Consent
     Decree was amended in the fourth quarter of 2005 to include PRS as a
     signing party. This assigns PRS full responsibility for complying with the
     terms of the Consent Decree and allows the EPA to enforce the Consent
     Decree directly with PRS. Prior to the execution of this amendment, U.S.
     GAAP required that the Company continue to record the full amount of the
     estimated remediation liability of $39.7 million and a corresponding asset
     of $39.2 million included in Other Assets in the balance sheet. With the
     subsequent amendment, the Company has removed the asset and $39.2 million
     of the liability from the balance sheet. While the Company believes the
     arrangements with PRS are sufficient to satisfy substantially all of the
     Company's environmental responsibilities with respect to the Site, these
     arrangements do not constitute a legal discharge or release of the
     Company's liabilities with respect to the Site. The actual cost of this
     obligation will be governed by numerous factors, including, without
     limitation, the requirements of the WDNR, and may be greater or lower than
     the amount accrued.

     With respect to other environmental matters, the Company has been
     voluntarily participating in a cooperative effort to investigate and
     cleanup PCB contamination in the watershed of the south branch of the
     Manitowoc River, at and downstream from the Company's New Holstein,
     Wisconsin facility. On December 29, 2004, the Company and TRC Companies and
     TRC Environmental Corporation (collectively, "TRC") entered into a Consent
     Order with the Wisconsin Department of Natural Resources (the "WDNR")
     relating to this effort known as the Hayton Area Remediation Project
     ("HARP"). The Consent Order provides a framework for the completion of the
     remediation and regulatory closure at HARP.



                                                                         Page 11
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 1
              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                   (Unaudited)


     Concurrently, on December 29, 2004, the Company and two of its subsidiaries
     and TRC entered into an Exit Strategy Agreement (the "Agreement"), whereby
     the Company transferred to TRC substantially all of its obligations to
     complete the HARP remediation pursuant to the Consent Order and in
     accordance with applicable environmental laws and regulations. TRC's
     obligations under the Agreement include any ongoing monitoring or
     maintenance requirements and certain off-site mitigation or remediation, if
     required. TRC will also manage any third-party remediation claims that
     might arise or otherwise be filed against the Company.

     As required by the Agreement, the Company also purchased a Pollution Legal
     Liability Select Cleanup Cost Cap Policy (the "Policy") from American
     International Specialty Lines Company. The term of the Policy is 20 years
     with an aggregate combined policy limit of $41 million. The policy lists
     the Company and TRC as named insureds and includes a number of first and
     third party coverages for remediation costs and bodily injury and property
     damage claims associated with the HARP remediation and contamination. The
     Company believes that the Policy provides additional assurance that the
     responsibilities, obligations, and liabilities transferred and assigned by
     the Company and assumed by TRC under the Agreement will be completed.
     Although the arrangements with TRC and the WDNR do not constitute a legal
     discharge or release of the Company's liabilities, the Company believes
     that the specific work substitution provisions of the Consent Order and the
     broad coverage terms of the Policy, collectively, are sufficient to satisfy
     substantially all of the Company's environmental obligations with respect
     to the HARP remediation. The total cost of the exit strategy insured
     remediation arrangement to Tecumseh was $16.4 million. This amount included
     $350,000 that was paid to the WDNR pursuant to the Consent Order to settle
     any alleged liabilities associated with natural resource damages. The
     charge represented the cost of the agreements less what was previously
     provided for cleanup costs to which the Company had voluntarily agreed.

     The Company, in cooperation with the WDNR, also conducted an investigation
     of soil and groundwater contamination at the Company's Grafton, Wisconsin
     plant. It was determined that contamination from petroleum and degreasing
     products used at the plant were contributing to an off-site groundwater
     plume. The Company began remediation of soils in 2001 on the east side of
     the facility. Additional remediation of soils began in the fall of 2002 in
     two other areas on the plant site. At March 31, 2006, the Company had
     accrued $2.3 million for the total estimated cost associated with the
     investigation and remediation of the on-site contamination. Investigation
     efforts related to the potential off-site groundwater contamination have to
     date been limited in their nature and scope. The extent, timing and cost of
     off-site remediation requirements, if any, are not presently determinable.

     In addition to the above-mentioned sites, the Company is also currently
     participating with the EPA and various state agencies at certain other
     sites to determine the nature and extent of any remedial action that may be
     necessary with regard to such other sites. At March 31, 2006 and December
     31, 2005, the Company had accrued $3.4 million and $3.5 million,
     respectively, for environmental remediation. As these matters continue
     toward final resolution, amounts in excess of those already provided may be
     necessary to discharge the Company from its obligations for these sites.
     Such amounts, depending on their amount and timing, could be material to
     reported net income in the particular quarter or period that they are
     recorded. In addition, the ultimate resolution of these matters, either
     individually or in the aggregate, could be material to the consolidated
     financial statements.



                                                                         Page 12
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 1
              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                   (Unaudited)


10.  Income Taxes

     The first quarter 2006 consolidated statement of operations reflects a $5.6
     million income tax benefit, which was recorded pursuant to SFAS No. 109,
     "Accounting for Income Taxes." SFAS 109 specifies the allocation method of
     income taxes between categories of income defined by that statement as
     those that are included in net income (continuing operations and
     discontinued operations) and those included in comprehensive income but
     excluded from net income.

     SFAS 109 is applied by tax jurisdiction, and in periods in which there is a
     pre-tax loss from continuing operations and pre-tax income in another
     category (such as other comprehensive income), tax expense is first
     allocated to other comprehensive income with a related benefit recorded in
     continuing operations. The first quarter of 2006 reflects tax benefit in
     the statement of operations and tax expense in other comprehensive income.
     At March 31, 2006 and December 31, 2005, full valuation allowances are
     recorded for net operating loss carryovers for those tax jurisdictions in
     which the Company is in a cumulative year loss position.

11.  Commitments and Contingencies

     A lawsuit filed against the Company and other defendants alleges that the
     horsepower labels on the products the plaintiffs purchased were inaccurate.
     The plaintiffs seek certification of a class of all persons in the United
     States who, beginning January 1, 1995 through the present, purchased a
     lawnmower containing a two stroke or four stroke gas combustible engine up
     to 20 horsepower that was manufactured by defendants. The complaint seeks
     an injunction, compensatory and punitive damages, and attorneys' fees. No
     orders have been entered in the case, and there has been limited discovery.
     While the Company believes it has meritorious defenses and intends to
     assert them vigorously, there can be no assurance that the Company will
     prevail. The Company also may pursue settlement discussions. It is not
     possible to reasonably estimate the amount of the Company's ultimate
     liability, if any, or the amount of any future settlement, but the amount
     could be material to the Company's financial position, consolidated results
     of operations and cash flows.

     The Company is also the subject of, or a party to, a number of other
     pending or threatened legal actions involving a variety of matters,
     including class actions, incidental to its business. Although their
     ultimate outcome cannot be predicted with certainty, and some may be
     disposed of unfavorably to the Company, management does not believe that
     the disposition of these other matters will have a material adverse effect
     on the consolidated financial position or results of operations of the
     Company.

12.  New Accounting Standards

     On November 24, 2004, the FASB issued Statement No. 151, Inventory Costs,
     an amendment of ARB No. 43, Chapter 4 (FAS 151). The standard adopts the
     IASB view related to inventories that abnormal amounts of idle capacity and
     spoilage costs should be excluded from the cost of inventory and expensed
     when incurred. Additionally, the Board made the decision to clarify the
     meaning of the term 'normal capacity'. The provisions of FAS 151 are
     applicable to inventory costs incurred during fiscal years beginning after
     June 15, 2005. The Company's adoption of this pronouncement during the
     first quarter of 2006 did not have a material effect.



                                                                         Page 13
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 1
              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                   (Unaudited)


13.  Discontinued Operations

     During the first quarter of 2006, the Company approved a plan to proceed
     with a transaction to sell 100% of its ownership interest in its Little
     Giant Pump Company subsidiary. The net assets of the subsidiary are
     classified as held for sale at March 31, 2006 and December 31, 2005, and
     its results for the quarters ended March 31, 2006 and 2005 are included in
     income (loss) from discontinued operations. Interest expense of $2.3
     million and $1.4 million was allocated to discontinued operations for all
     the periods presented because the Company's new financing package required
     that the proceeds from the sale be utilized to repay portions of the
     Company's debt. The Company's remaining pump business does not meet the
     definition of an operating segment as defined by SFAS No. 131, "Segment
     Reporting." Accordingly, its operating results are included in Other within
     the Results by Segment table.

     Following is a summary of assets and liabilities of Little Giant Pump
     Company at March 31, 2006 and December 31, 2005, which are reflected in the
     consolidated balance sheets as held for sale:

<TABLE>
<CAPTION>
                                                                   March 31,       December 31,
    (Dollars in millions)                                            2006              2005
                                                                 ------------      ------------
<S>                                                              <C>               <C>
     Accounts receivable, net                                    $       17.2      $       13.5
     Inventories                                                         30.8              25.7
     Other current assets                                                 0.3               0.3
     Property, plant and equipment, net                                   9.6              10.1
     Goodwill                                                             5.1               5.1
                                                                 ------------      ------------
     Assets held for sale                                        $       63.0      $       54.7
                                                                 ============      ============

     Accounts payable, trade                                     $        9.6      $        7.2
     Accrued liabilities                                                  5.4               5.5
                                                                 ------------      ------------
     Liabilities held for sale                                   $       15.0      $       12.7
                                                                 ============      ============
</TABLE>

     Following is a summary of income (loss) from discontinued operations for
     the quarters ended March 31, 2006 and 2005:

<TABLE>
<CAPTION>
                                                                   March 31,       March 31,
     (Dollars in millions)                                           2006              2005
                                                                 ------------      ------------
<S>                                                              <C>               <C>
     Net sales                                                   $       26.8      $       24.2
     Costs of sales and operating expenses                               19.2              17.9
     Selling and administrative expenses                                  5.6               4.7
                                                                 ------------      ------------
     Operating income                                                     2.0               1.6
     Interest expense allocated                                           2.3               1.4
                                                                 ------------      ------------
     Income (Loss) from discontinued operations
     before income taxes                                                 (0.3)              0.2
     Tax provision                                                        0.2               0.1
                                                                 ------------      ------------
     Income (Loss) from discontinued operations, net of tax      $       (0.5)     $        0.1
                                                                 ============      ============
</TABLE>



                                                                         Page 14
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 1
              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                   (Unaudited)


14.  Subsequent Event

     During the first quarter of 2006, the Company entered into an agreement to
     sell its Little Giant Pump Company subsidiary to Franklin Electric Company,
     Inc. for approximately $121 million, subject to post-closing adjustments.
     The subsidiary is classified as held for sale at March 31, 2006, and its
     results for the periods ended March 31, 2006 and 2005 are included in
     income (loss) from discontinued operations. On April 21, 2006, the Company
     completed the sale. As required by the Company's new financing package, the
     proceeds from the sale were used to repay portions of the Company's debt.



                                                                         Page 15
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 2
                   MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS


Executive Summary

We are one of the largest independent producers of hermetically sealed
compressors in the world, one of the world's leading manufacturers of small
gasoline engines and power train products used in lawn and garden applications,
and one of the leading manufacturers of fractional horsepower motors for the
United States market. Our net sales have grown by approximately $400 million
from the year ended December 31, 2001 to the year ended December 31, 2005. The
primary source of sales growth was our 2002 acquisition of FASCO Motors, now the
key component of our presence in the U.S. fractional horsepower motor market.
Our products are sold in countries all over the world.

In evaluating our financial condition and operating performance, we focus
primarily on profitable sales growth and cash flows, as well as return on
invested capital on a consolidated basis. In addition to maintaining and
expanding our business with our existing customers in our more established
markets, we rely on developing new products and improving our ability to
penetrate new markets through enhancements to the functionality, performance and
quality of our existing products. For instance, our Compressor Group will
introduce a scroll-style compressor to serve commercial refrigeration and air
conditioning markets throughout the globe, and it will begin producing a new
expanded range rotary compressor in India for global applications, while our
Electrical Components Group has expanded its range of Brushless DC ("BLDC")
variable speed motor products. To continue to grow sales and improve cash flows,
we must successfully bring these products to market in a timely manner and win
customer acceptance.

International sales are important to our business as a whole with sales to
customers outside the United States representing approximately 50% of total
consolidated net sales in 2005. The Company's dependence on sales in foreign
countries entails certain commercial and political risks, including currency
fluctuations, unstable economic or political conditions in some areas and the
possibility of various government interventions into trade policy. We have
experienced some of these factors and continue to carefully pursue these
markets.

Our operating results are indicative of the environment that manufacturers face
in today's global economy. The addition of new productive capacities in low-cost
locations, like China, has resulted in new capacities and deflationary pricing
in many of the market segments in which we operate. Like many of our customers
and competitors, we have restructured older operations to remain cost
competitive, including the movement of productive capacities to low-cost
locations or nearer to customer facilities. These restructurings involve
significant costs, in both financial and human terms. In addition, many of our
markets are subject to macroeconomics trends, which expand and contract, and
many overall trends, which affect demand, such as weather.

The foreign manufacturing operations we have developed are subject to many
risks, including governmental expropriation, governmental regulations that may
be disadvantageous to businesses owned by foreign nationals, and instabilities
in the workforce due to changing political and social conditions. These
considerations are especially significant in the context of our Brazilian
operations. The Brazilian compressor operations provided a significant portion
of total Compressor Products segment production during 2005, and our Curitiba,
Brazil facility is the key future manufacturing site to supply worldwide demand
for lawn and garden engines.



                                                                         Page 16
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 2
                   MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS


As a global manufacturer with production in 11 countries and sales in over 110
countries throughout the world, results are sensitive to changes in foreign
currency exchange rates. In total, those movements have not been favorable to us
during 2005 and the first three months of 2006. We have developed strategies to
mitigate or partially offset the impact, primarily hedging where the risk of
loss is greatest. In particular, we have entered into foreign currency forward
purchases to hedge the Brazilian export sales denominated in both U.S. Dollars
and Euros. Additionally, we have structured local financing relationships as
natural hedges.

Lastly, commodity prices increased very rapidly during 2004, 2005 and into 2006.
Due to competitive markets, we were not able to fully recover these cost
increases through price increases and other cost savings. Increases in certain
raw material, energy and commodity costs have had a material adverse impact on
our operating results during these periods. We have developed strategies to
mitigate or partially offset the impact, which include aggressive cost reduction
actions, cost optimization engineering strategies, selective in-sourcing of
components where we have available capacity, continued consolidation of our
supply base, and acceleration of low-cost country sourcing. In addition, the
sharing of increased raw material costs has been, and will continue to be, the
subject of negotiations with our customers. While we believe that our mitigation
strategies eventually will offset a substantial portion of the financial impact
of these increased costs, no assurances can be given that the magnitude and
duration of these increased costs will not have a continued material adverse
impact on our operating results. We are very focused on efforts to help us
maintain our ability to compete on cost.

Our success in generating cash flow will depend, in part, on our ability to
efficiently manage working capital. In this regard, changes in inventory
management practices and customer and vendor payment terms had a positive impact
on our reported cash flows when comparing the first quarter of 2006 to 2005. In
addition, our cash flow is also dependent on our ability to efficiently manage
our capital spending. We use cash return on invested capital as a measure of the
efficiency with which assets are deployed to increase earnings. Improvements in
our return on invested capital will depend on our ability to maintain an
appropriate asset base for our business and to increase productivity and
operating efficiency.

For further information related to other factors that have had, or may in the
future have, a significant impact on our business, financial condition or
results of operations, see "Cautionary Statements Relating To Forward-Looking
Statements" below.




                                                                         Page 17
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 2
                   MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS


Results of Operations

A summary of our operating results as a percentage of net sales is shown below
(dollar amounts in millions):

<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31,
(dollars in millions)                                           2006                 %              2005                 %
<S>                                                         <C>               <C>               <C>               <C>
Net sales                                                   $      446.1             100.0%     $      440.2             100.0%
Cost of sales and operating expenses                               411.6              92.3%            412.7              93.8%
Selling and administrative expenses                                 45.2              10.1%             43.4               9.9%
Impairments, restructuring charges, and other items                  0.6               0.1%              0.1               0.0%
                                                            ------------                        ------------
Operating loss                                                     (11.3)             -2.5%            (16.0)             -3.6%
Interest expense                                                    (8.4)              1.9%             (6.3)              1.4%
Interest income and other, net                                       5.0               1.1%              3.3               0.7%
                                                            ------------                        ------------
Loss from continuing operations before taxes                       (14.7)              3.3%            (19.0)             -4.3%
Tax benefit                                                         (5.6)             -1.3%             (6.5)             -1.5%
                                                            ------------                        ------------
Loss from continuing operations                             $       (9.1)              2.0%     $      (12.5)             -2.8%
                                                            ============                        ============
</TABLE>

Three Months Ended March 31, 2006 vs. Three Months Ended March 31, 2005

Consolidated net sales from continuing operations in the first quarter of 2006
increased to $446.1 million from $440.2 million in 2005. Excluding the increase
in sales due to the effects of currency fluctuation of $9.1 million, 2006 first
quarter sales declined by $3.2 million. While sales improved in the Compressor
and Electrical Components segments, declines in sales in the Engine & Power
Train segment more than offset the increases.

Cost of sales and operating expenses was $411.6 million in the three months
ended March 31, 2006, as compared to $412.7 million in the three months ended
March 31, 2005. As a percentage of net sales, cost of sales and operating
expenses were 92.3% and 93.8% in the first quarters of 2006 and 2005,
respectively. The improvement was primarily due to improved operational
efficiencies and lower fixed costs associated with plant closures. Also included
in cost of sales and operating expenses was the $3.5 million gain from the sale
of the Douglas, Georgia engine facility.

Selling, general and administrative expenses were $45.2 million in the three
months ended March 31, 2006, as compared to $43.4 million in the three months
ended March 31, 2005. As a percentage of net sales, selling, general and
administrative expenses were 10.1% and 9.9% in the first quarters of 2006 and
2005, respectively. The increase was primarily related to AlixPartners' fees of
$9.0 million offset by improved variable selling costs and global headcount
reductions.

Interest expense amounted to $8.4 million in the first quarter of 2006 compared
to $6.3 million in the first quarter of 2005. The increase was primarily related
to the higher average interest rates associated with the Company's current
borrowing arrangements.



                                                                         Page 18
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 2
                   MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS


Interest income and other, net was $5.0 million in the first quarter of 2006
compared to $3.3 million in the first quarter of 2005. The impact of lower
interest income due to lower cash balances was more than offset by a gain of
$3.6 million on the sale of the Company's interest in Kulthorn Kirby Public
Company Limited, a manufacturer of compressors based in Thailand. The sale of
the stock was completed in conjunction with the end of a licensing agreement
between the Company's Compressor operations and Kulthorn Kirby.

The first quarter 2006 consolidated statement of operations reflects a $5.6
million income tax benefit, which was recorded pursuant to SFAS No. 109,
"Accounting for Income Taxes." SFAS 109 specifies the allocation method of
income taxes between categories of income defined by that statement as those
that are included in net income (continuing operations and discontinued
operations) and those included in comprehensive income but excluded from net
income.

SFAS 109 is applied by tax jurisdiction, and in periods in which there is a
pre-tax loss from continuing operations and pre-tax income in another category
(such as other comprehensive income), tax expense is first allocated to other
comprehensive income with a related benefit recorded in continuing operations.
The first quarter of 2006 reflects tax benefit in the statement of operations
and tax expense in other comprehensive income. At March 31, 2006 and December
31, 2005, full valuation allowances are recorded for net operating loss
carryovers for those tax jurisdictions in which the Company is in a cumulative
year loss position.

Net loss from continuing operations in the first quarter of 2006 was $9.1
million, or $0.49 per share, as compared to net loss of $12.5 million, or $0.68
per share, in the first quarter of 2005. The improvement was primarily the
result of the factors described above.

Reportable Operating Segments

The financial information presented below is for our three reportable operating
segments for the periods presented: Compressor, Electrical Components, and
Engine & Power Train. Financial measures regarding each segment's income (loss)
before interest, other expense, income taxes, and impairments, restructuring
charges, and other items ("operating income") and income (loss) before interest,
other expense and income taxes and impairments, restructuring charges, and other
items divided by net sales ("operating margin") are not measures of performance
under accounting principles generally accepted in the United States (GAAP). Such
measures are presented because we evaluate the performance of our reportable
operating segments, in part, based on income (loss) before interest, other
expense, income taxes, and impairments, restructuring charges, and other items.
These measures should not be considered in isolation or as a substitute for net
income, net cash provided by operating activities or other income statement or
cash flow statement data prepared in accordance with GAAP or as measures of
profitability or liquidity. In addition, these measures, as we determine them,
may not be comparable to related or similarly titled measures reported by other
companies. For a reconciliation of consolidated income (loss) before interest,
other expense and income taxes, impairments, restructuring charges, and other
items to income before provision for income taxes, see Note 8, Segment
Reporting.



                                                                         Page 19
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 2
                   MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS


     Compressor Products

First quarter 2006 sales in the Compressor business increased 4.4% to $251.5
million from $241.0 million in the prior year. The increase for the period was
mostly attributable to effects of foreign currency translation that increased
current quarter sales by $9.2 million. Overall, unit sales volumes were
relatively consistent with the prior year with some change in product mix.

Compressor business operating income and related margin for the first quarter of
2006 were $6.6 million and 2.6%, respectively, compared to $8.6 million and 3.6%
in the first quarter of 2005. The operating income decrease was attributable to
an unfavorable product mix and higher material and other input costs offset by
productivity improvements. The Brazilian Real that was on average 16% stronger
against the U.S. Dollar in the first quarter of 2006 versus 2005, but hedging
activities mitigated the financial impact.

     Electrical Component Products

Electrical Components business sales were $109.1 million for the first quarter
of 2006, an increase of 8.9% over sales of $100.2 million in the same quarter
last year. Volume increases in residential and commercial motor markets of
approximately 16%, where HVAC markets were particularly robust, more than
compensated for a decrease of approximately 11% in the automotive motor market,
as a result of lower build schedules and share losses by the Company's customers
at their respective OEM customers.

Electrical Components operating income and related margin for the first quarter
of 2006 were $4.9 million and 4.5%, respectively, compared to a loss of $1.1
million and (1.1%) in the first quarter of 2005. The improvement was primarily
due to higher sales volumes, improved operational efficiencies, and pricing
actions taken during 2005.

     Engine & Power Train Products

Engine & Power Train business sales were $80.9 million in the first quarter of
2006 compared to $94.9 million for the same period a year ago, a decrease of
14.8%. The decline in sales for the first quarter was due to the loss of sales
into the European market from the Company's former Italian subsidiary. As
previously disclosed on December 28, 2005, the Company closed its engine
manufacturing operations of its wholly owned subsidiary, Tecumseh Europa S.p.A.,
located in Turin, Italy. The shutdown was accomplished through an Italian form
of court-supervised liquidation. The effects of the liquidation were reflected
in the Company's 2005 results. The Italian subsidiary was the primary, but not
sole, source of engines for sales in the European market. This decline in unit
volumes sold into Europe was partially offset by an increase in volumes sold
into the United States that were primarily attributable to the placement of the
Company's engines on additional product sku's at existing customers. North
American engine unit deliveries were approximately 11% greater than the prior
year's first quarter.

Engine & Power Train business operating loss and related margin for the first
quarter of 2006 were $18.5 million and (22.9%), respectively, compared to a loss
of $20.9 million and (22.0%) during the same period a year ago. Included in the
2006 loss were AlixPartners' fees of $9.0 million and a $3.5 million gain from
the sale of the Douglas, Georgia engine facility. Exclusive of these two items,



                                                                         Page 20
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 2
                   MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS


operating results improved by approximately 38%. The improvement reflected lower
fixed costs associated with plant closures, higher productivity levels in
Brazil, the non-recurrence of costs associated with a transmission recall, and
higher U.S. volumes, partially offset by higher commodity and transportation
costs and a less favorable value of the Brazilian Real.

OTHER MATTERS

Environmental Matters

We are subject to various federal, state and local laws relating to the
protection of the environment and are actively involved in various stages of
investigation or remediation for sites where contamination has been alleged.
(See Note 10 to the financial statements.) Liabilities relating to probable
remediation activities are recorded when the costs of such activities can be
reasonably estimated based on the facts and circumstances currently known.
Difficulties exist estimating the future timing and ultimate costs to be
incurred due to uncertainties regarding the status of laws, regulations, levels
of required remediation, changes in remediation technology and information
available.

At March 31, 2006 and December 31, 2005, we had accrued $3.4 million and $3.5
million, respectively, for environmental remediation. As these matters continue
toward final resolution, amounts in excess of those already provided may be
necessary to discharge our obligations for these sites. Such amounts, depending
on their amount and timing, could be material to reported net income in the
particular quarter or period in which they are recorded. In addition, the
ultimate resolution of these matters, either individually or in the aggregate,
could be material to the consolidated financial statements.

AlixPartners Engagement

We engaged AlixPartners during the third quarter of 2005 to assist in the
restructuring plans of the Engine & Power Train business. These plans include
focusing on improving profitability and customer service. We believe the
participation by AlixPartners will allow the Company to effect this change in a
shorter time frame than it otherwise could have achieved. The plan includes
eliminating the significant duplicate capacity, among other cost reduction
efforts. During the first quarter of 2006, the Company recognized fees of $9.0
million related to the AlixPartners engagement.

LIQUIDITY AND CAPITAL RESOURCES

Our primary liquidity needs are to fund capital expenditures, service
indebtedness, and support working capital requirements. Our principal sources of
liquidity are cash flows from operating activities and borrowings under
available credit facilities. A substantial portion of our operating income is
generated by foreign operations. As a result, we are dependent on the earnings
and cash flows of and the combination of dividends, distributions and advances
from our foreign operations to provide the funds necessary to meet our
obligations in each of our legal jurisdictions. There are no significant
restrictions on the ability of our subsidiaries to pay dividends or make other
distributions.

Cash Flow

For the first quarter 2006, cash used by operations amounted to $44.5 million,
reflecting both an operating loss and net investments in working capital items.
This represented an improvement of $22.9



                                                                         Page 21
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 2
                   MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS


million compared to the first quarter 2005, primarily as a result of better
management of working capital over the respective quarters as sales were more in
line with expectations.

Cash used in investing activities was $13.0 million in the first quarter 2006
versus $28.7 million for the same period of 2005. Of the overall decrease, $8.7
million was related to lower capital expenditures due to significant new product
expansions in India and Brazil in the prior years, and $9.0 million related to
proceeds received from the sale of assets during 2006. Included in such sales
were the sale of the Company's 7% interest in Kulthorn Kirby Public Company
Limited stock for $4.7 million and the sale of the Company's former Douglas,
Georgia manufacturing facility for $3.5 million. In addition, during the first
quarter, the Company acquired a small Australian-based company, which owned
patents related to the manufacturing of certain types of electric motors, which
are applicable to both our Electrical Components, and Compressor segments. The
entire purchase price was allocated to intangible assets.

Cash flows from financing activities provided cash of $24.0 million in the first
quarter of 2006 as compared to using $47.4 million in the quarter of 2005.
During 2005, we used existing cash balances to prepay $50 million of our then
Senior Guaranteed Notes in order to remain within our debt covenants at March
31, 2005. During the first quarter 2006, the remaining balance of these Senior
Guaranteed Notes, our Revolving Credit Facility and our outstanding Industrial
Revenue Bonds were replaced by a new financing package that included a $275
million First Lien Credit Agreement and a $100 million Second Lien Credit
Agreement.

Capitalization

In addition to cash provided by operating activities, we use a combination of
our revolving credit arrangement under our First Lien Credit Agreement,
long-term debt under our Second Lien Credit Agreement, and foreign bank debt to
fund our capital expenditures and working capital requirements. For the three
months ended March 31, 2006 and March 31, 2005, our average outstanding debt
balance was $372.5 million and $363.6 million, respectively. The weighted
average long-term interest rate, including the effect of hedging activities, was
7.4% and 4.6% for the respective periods. Among other factors, the change in the
weighted average, long-term interest rate for the respective periods reflects
the increase in the borrowing rate applicable to our new borrowing arrangements
of 8.8% as compared to the original interest rate of 4.6% under our Senior
Guaranteed Notes.

The Company may also utilize long-term financing arrangements in connection with
state investment incentive programs.

Accounts Receivable Sales

Certain of our Brazilian and Asian subsidiaries periodically sell their accounts
receivable with financial institutions. Such receivables are factored with
recourse to us and, in most cases, are excluded from accounts receivable in our
consolidated balance sheets. The amount of sold receivables excluded from our
balance sheet was $35.2 million and $32.1 million as of March 31, 2006 and
December 31, 2005, respectively. We cannot provide any assurances that these
facilities will be available or utilized in the future.



                                                                         Page 22
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 2
                   MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS


Adequacy of Liquidity Sources

Historically, cash flows from operations and borrowing capacity under previous
credit facilities were sufficient to meet our long-term debt maturities,
projected capital expenditures and anticipated working capital requirements;
however, the negative results experienced during 2005 deteriorated to the point
where we were not able to remain in compliance with the covenants of the Senior
Guaranteed Notes and the Revolving Credit Facility as amended as of August 5,
2005. Accordingly, on February 6, 2006, we replaced the Senior Guaranteed Notes,
Revolving Credit Agreement and Industrial Revenue Bonds with a new financing
package that included a $275 million first Lien Credit Agreement and a $100
million Second Lien Credit Agreement. The agreements provide for security
interests in substantially all of the Company's assets and specific financial
covenants related to EBITDA, capital expenditures, and fixed charge coverage.
Additionally, under the terms of the agreements, no dividends can be paid prior
to December 31, 2006 and minimum amounts of credit availability are required
before dividends can be paid thereafter.

In addition, subsequent to March 31, 2006, proceeds from the sale of Little
Giant Pump Company were used to repay portions of the new debt arrangements.
Approximately, 63% of the proceeds was applied against the First Lien borrowing
and 37% against the Second Lien borrowing. After giving affect to the
repayments, the weighted average annual interest rate of these borrowings was
8.8%.

The Company continues to monitor its future expected results in relationship to
the financial covenants specified under the terms of the respective borrowing
arrangements and the amount of availability of funds provided by the computation
of borrowing base. Based upon proceeds provided by the sale of Little Giant and
the total availability of funds, we believe the Company has sufficient liquidity
to complete its turnaround plans; however, should operating performance fall
short of plan, the Company may not remain in compliance with the covenants under
the agreements, or have sufficient availability of funds. In this scenario, the
Company would need to obtain amendments to the borrowing arrangements.

SIGNIFICANT ACCOUNTING POLICIES AND CRITICAL ACCOUNTING ESTIMATES

Some of our accounting policies require management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at the
date of the consolidated financial statements and the reported amounts of
revenues and expenses during the reporting period. These estimates and
assumptions are subject to an inherent degree of uncertainty. They are based on
our historical experience, the terms of existing contracts, our evaluation of
trends in the industry, information provided by our customers and suppliers, and
information available from other outside sources, as appropriate. Actual results
in these areas could differ from our estimates. For a discussion of our
significant accounting policies and critical accounting estimates, see Item 7,
"Management's Discussion and Analysis of Financial Condition and Results of
Operations -- Significant Accounting Policies and Critical Accounting
Estimates," and Note 1, "Accounting Policies," to the consolidated financial
statements included in our Annual Report on Form 10-K for the year ended
December 31, 2005. There have been no significant changes to our significant
accounting policies or critical accounting estimates during the first three
months of 2006.



                                                                         Page 23
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 2
                   MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS


Recently Issued Accounting Pronouncements

Inventory Costs

The Financial Accounting Standards Board ("FASB") issued SFAS No. 151,
"Inventory Costs -- an amendment of ARB No. 43, Chapter 4." This statement
clarifies the requirement that abnormal inventory-related costs be recognized as
current-period charges and requires that the allocation of fixed production
overheads to inventory conversion costs be based on the normal capacity of the
production facilities. The provisions of this statement are to be applied
prospectively to inventory costs incurred during fiscal years beginning after
June 15, 2005. The Company's adoption of this pronouncement during the first
quarter of 2006 did not have a material effect.

OUTLOOK

Information in this "Outlook" section should be read in conjunction with the
cautionary language and discussion of risks included below.

The outlook for the remainder of 2006 is subject to the same variables that
negatively impacted the Company throughout 2005. Commodity costs, key currency
rates, weather and the overall growth rates of the respective economies around
the world are all important to future performance. Overall, the Company does not
expect these factors to become any more favorable during the year. In fact,
certain key commodities, including copper, aluminum, and steel have risen
precipitously in recent months. From January 1, 2006 through April 28, 2006, the
prices of copper and aluminum have increased approximately 60% and 21%,
respectively.

The Company expects 2006 results to reflect only those actions it has been
taking to reduce costs and, potentially, the benefits of new product
introductions, to the extent they are accepted in the market, and has not
assumed any improvements from currencies or commodity costs. Given the recent
escalation in commodity costs, realization of net improvement in total results,
which is largely expected in the latter half of the year, will greatly depend on
the Company's ability to pass on to its customers the cost of these sizeable
commodity price increases, which are hedged to a lesser extent in the later
months of the year.

With respect to each of the Company's segments, results in the Compressor Group
are expected to lag the results of 2005 throughout the year. The Electrical
Components Group, which has demonstrated monthly year over year improvement
since August of 2005, is expected to continue its improvement through 2006. The
Engine and Power Train business has taken several major steps to eliminate
overcapacity and costs that will benefit 2006, with the most significant
improvements expected in the fourth quarter of the year.

The Company will continue to focus its efforts on improving the profitability
and competitiveness of its worldwide operations. It is likely that additional
production relocation and consolidation initiatives will take place during 2006
that could have an effect on the consolidated financial position and future
results of operations of the Company. In addition, the Company continues to
evaluate potential acquisitions, joint ventures and dispositions that could
improve the overall competitiveness and financial position of the Company and
enhance its product offerings. Such transactions could also have an effect on
future results of operations.



                                                                         Page 24
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 2
                   MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS


CAUTIONARY STATEMENTS RELATING TO FORWARD-LOOKING STATEMENTS

This discussion contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act that are subject to the safe harbor
provisions created by that Act. In addition, forward-looking statements may be
made orally in the future by or on behalf of us. Forward-looking statements can
be identified by the use of terms such as "expects," "should," "may,"
"believes," "anticipates," "will," and other future tense and forward-looking
terminology, or by the fact that they appear under the caption "Outlook."

Readers are cautioned that actual results may differ materially from those
projected as a result of certain risks and uncertainties, including, but not
limited to, i) changes in business conditions and the economy in general in both
foreign and domestic markets; ii) the effect of terrorist activity and armed
conflict; iii) weather conditions affecting demand for air conditioners, lawn
and garden products, portable power generators and snow throwers; iv) the
success of our ongoing effort to bring costs in line with projected production
levels and product mix; v) financial market changes, including fluctuations in
interest rates and foreign currency exchange rates; vi) economic trend factors
such as housing starts; vii) emerging governmental regulations; viii)
availability and cost of materials, particularly commodities, including steel,
copper and aluminum, whose cost can be subject to significant variation; ix)
actions of competitors; x) the ultimate cost of resolving environmental and
legal matters; xi) our ability to profitably develop, manufacture and sell both
new and existing products; xii) the extent of any business disruption that may
result from the restructuring and realignment of our manufacturing operations or
system implementations, the ultimate cost of those initiatives and the amount of
savings actually realized; xiii) potential political and economic adversities
that could adversely affect anticipated sales and production in Brazil; xiv)
potential political and economic adversities that could adversely affect
anticipated sales and production in India, including potential military conflict
with neighboring countries; xv) our ability to reduce a substantial amount of
costs in the Engine & Power Train group associated with excess capacity, and
xvi) the ongoing financial health of major customers. These forward-looking
statements are made only as of the date of this report, and we undertake no
obligation to update or revise the forward-looking statements, whether as a
result of new information, future events or otherwise.



                                                                         Page 25
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 3
           QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK


The Company is exposed to risk during the normal course of business from credit
risk associated with accounts receivable and from changes in interest rates,
commodity prices, and foreign currency exchange rates. The exposure to these
risks is managed through a combination of normal operating and financing
activities which include the use of derivative financial instruments in the form
of foreign currency forward exchange contracts and commodity forward purchasing
contracts. Fluctuations in commodity prices and foreign currency exchange rates
can be volatile, and the Company's risk management activities do not totally
eliminate these risks. Consequently, these fluctuations can have a significant
effect on results. A discussion of the Company's policies and procedures
regarding the management of market risk and the use of derivative financial
instruments was provided in its Annual Report on Form 10-K in Item 7A and in
Notes 1 and 12 of the Notes to Consolidated Financial Statements. The Company
does not utilize financial instruments for trading or other speculative
purposes. There have been no changes in these policies or procedures during the
first quarter of 2006.

The Company is subject to foreign currency exchange exposure for operations
whose assets and liabilities are denominated in currencies other than U.S.
Dollars. On a normal basis, the Company does not attempt to hedge the foreign
currency translation fluctuations in the net investments in its foreign
subsidiaries. The Company does, from time to time, enter into short-term forward
exchange contracts to sell or purchase foreign currencies at specified rates
based on estimated foreign currency cash flows. Company policy allows local
management to hedge known receivables or payables and forecasted cash flows up
to a year in advance. It is the policy of the Company not to purchase financial
and/or derivative instruments for speculative purposes. At March 31, 2006 and
December 31, 2005, the Company held foreign currency forward contracts with a
total notional value of $127.5 million and $173.0 million, respectively.

The Company uses commodity forward purchasing contracts to help control the cost
of traded commodities, primarily copper and aluminum, used as raw material in
the production of motors, electrical components and engines. Company policy
allows local management to contract commodity forwards for a limited percentage
of projected raw material requirements up to one year in advance. Commodity
contracts at most of the Company's divisions and subsidiaries are essentially
purchase contracts designed to fix the price of the commodities during the
operating cycle. The Company's practice has been to accept delivery of the
commodities and consume them in manufacturing activities. At March 31, 2006 and
December 31, 2005, the Company held a total notional value of $33.8 million and
$61.8 million, respectively, in commodity forward purchasing contracts. The
majority of these contracts were not recorded on the balance sheet as they did
not require an initial cash outlay and do not represent a liability until
delivery of the commodities is accepted; however, commodity contracts at the
Company's French compressor subsidiary are essentially derivative financial
instruments designed to hedge the fluctuation in commodity pricing and, as such,
are subject to the provisions of SFAS No. 133, as amended by SFAS 149.

The Company is subject to interest rate risk, primarily associated with its
borrowings of $403 million at March 2006. The Company's $275 million First Lien
Credit Agreement and $100 million Second Lien Credit agreement are variable-rate
debt. The Company has entered into variable to fixed interest rate swaps with
notional amounts totaling $100 million. The Company's remaining borrowings
consists of variable-rate borrowings by its foreign subsidiaries. This resulted
in 25% of the Company's total debt at March 31, 2006 being fixed-rate. While
changes in interest rates impact the fair value of the fixed rate debt, there is
no impact to earnings and cash flow because the Company intends to hold these
obligations to maturity unless refinancing conditions are favorable.
Alternatively, while changes in


                                                                         Page 26
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 3
           QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK


interest rates do not affect the fair value of the Company's variable-interest
rate debt, they do affect future earnings and cash flows. A 1% increase in
interest rates would increase interest expense for the year by approximately
$3.0 million.



                                                                         Page 27
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 4
                             CONTROLS AND PROCEDURES


The Company maintains disclosure controls and procedures that are designed to
ensure that information required to be disclosed in the reports that the Company
files or submits under the Securities Exchange Act of 1934 is recorded,
processed, summarized, and reported within the time periods specified in the
SEC's rules and forms, and that such information is accumulated and communicated
to the Company's management, including its President and Chief Executive Officer
and Vice President, Treasurer and Chief Financial Officer, as appropriate, to
allow timely decisions regarding required disclosure.

As of the end of the fiscal quarter covered by this report, the Company carried
out an evaluation, under the supervision and with the participation of the
Company's Disclosure Committee and management, including the President and Chief
Executive Officer and the Company's Vice President, Treasurer and Chief
Financial Officer, of the effectiveness of the design and operation of our
disclosure controls and procedures pursuant to Exchange Act Rule 13a-15. Based
upon such evaluation, the Company's President and Chief Executive Officer along
with the Company's Vice President, Treasurer and Chief Financial Officer
concluded that the Company's disclosure controls and procedures which were
identified as not effective as of December 31, 2005 because of the material
weakness discussed below, have not yet been fully corrected and are, therefore,
not effective as of March 31, 2006. In light of the material weakness, the
Company performed additional analysis and other post-closing procedures to
ensure our consolidated financial statements were prepared in accordance with
generally accepted accounting principles. Accordingly, management believes that
the financial statements included in this report fairly state in all material
respects our financial condition, results of operations and cash flows for the
periods presented.

As outlined in management's annual report as of December 31, 2005, the Company
did not maintain effective controls over user access rights to certain financial
application systems which could affect accounts receivable and revenue,
inventory and cost of goods sold, and accounts payable and other financial
statement accounts at a number of its locations. Specifically, the control
deficiencies demonstrated an inadequate design of access security policies and
segregation of duties requirements as well as a lack of independent monitoring
of user access to financial application programs and data. Individually, these
deficiencies were evaluated as representing a more than remote likelihood that a
misstatement that is more than inconsequential, but less than material, could
occur; however, when aggregated, these deficiencies could result in a
misstatement to the financial statement accounts, resulting in a material
misstatement to the consolidated financial statements that would not be
prevented or detected.

The Company has implemented additional controls to remediate this material
weakness. These controls include, but are not limited to, additional levels of
reviews of transactions, additional reviews of changes to financial applications
and data by those with access to both, and reassignment of responsibilities to
provide for better segregation of duties. While specific efforts have been
undertaken to address the segregation of duties and system access issues within
each of the affected locations, the Company has not completed its process to
verify the adequacy of the measures taken and ensure these steps had completely
addressed the previously identified concerns.

The Company has also made progress with respect to its implementation of a
common, global ERP system, which represents the long-term solution to these
deficiencies as well as a significant improvement to the overall internal
control structure of the Company. The system implementation includes improved
controls over access to financial application programs and data, independent



                                                                         Page 28
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                     PART 1. FINANCIAL INFORMATION - ITEM 4
                             CONTROLS AND PROCEDURES


monitoring of users having unrestricted access to financial application programs
and data, and provides for improved segregation of duties. On April 1, 2006,
five of nine locations, scheduled for implementation during 2006, went live. All
remaining locations are expected to go live before the end of 2007.

Changes In Internal Control Over Financial Reporting

As noted above, the Company is in the process of implementing a new global ERP
system. Location implementations began in the first quarter of 2005 and the
Company's remaining locations are expected to go live during 2006 and 2007.
During this time period, there will be significant changes in internal controls
over financial reporting at the operations affected. The Company believes it has
designed adequate controls into the new system and will begin testing their
application at each location after their respective go-live dates.

There have been no changes in the Company's internal controls over financial
reporting that occurred during the quarter that have materially affected, or are
reasonably likely to materially affect, the Company's internal control over
financial reporting.

Limitations On The Effectiveness Of Controls And Procedures

Management of the Company, including the chief executive officer and chief
financial officer, does not expect that the Company's disclosure controls and
procedures or internal control over financial reporting will detect or prevent
all error and all fraud. A control system, no matter how well designed and
implemented, can provide only reasonable, not absolute, assurance that the
control system's objective will be met. Because of the inherent limitations in
all control systems, no evaluation of controls can provide absolute assurance
that all control issues within a company are detected.

In addition, projection of any evaluation of the effectiveness of internal
control over financial reporting to future periods is subject to the risk that
controls may become inadequate because of changes in condition, or that the
degree of compliance with policies and procedures included in such controls may
deteriorate.



                                                                         Page 29
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                           PART II. OTHER INFORMATION


ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

The Annual Meeting of Shareholders of Tecumseh Products Company was held on
April 26, 2006. Proxies for the meeting were solicited pursuant to Section 14(a)
of the Securities Exchange Act of 1934, and there was no solicitation in
opposition to management's solicitation.

(a)  All of management's nominees for directors as listed in the proxy statement
     were elected with the following votes:

<TABLE>
<CAPTION>
                                                                    Votes             Votes
     Director                                                        For             Withheld
                                                                 ------------      ------------
<S>                                                              <C>               <C>
     Peter M. Banks                                                 4,303,096           353,124
     Jon E. Barfield                                                4,088,770           567,450
     Todd W. Herrick                                                4,626,030            30,190
     Albert A. Koch                                                 4,085,855           570,365
     David M. Risley                                                4,088,825           567,395
</TABLE>

(b)  The selection of PricewaterhouseCoopers to serve as the independent auditor
     of Tecumseh Products Company was approved.

<TABLE>
<CAPTION>
                                                         Votes            Votes            Votes
                                                          For            Against          Abstain
                                                      ------------     ------------     ------------
<S>                                                   <C>              <C>              <C>
     Ratification of PricewaterhouseCoopers
     as independent accountants                          4,654,519              497            1,204
</TABLE>

ITEM 5. OTHER INFORMATION

On May 5, 2006 (effective as of February 6, 2006) we entered into amendments to
our First Lien Credit Agreement and Second Lien Credit Agreement to clarify that
our Brazilian subsidiaries' practice of selling receivables under programs
administered by the Brazilian Central Bank is permitted under each agreement's
covenant limiting the indebtedness we can incur. For more detailed information,
please see the copies of the amendments filed as exhibits to this report.

ITEM 6. EXHIBITS

               Exhibit
    (a)         Number     Description

                  4.1      Amendment No. 1 to First Lien Credit Agreement dated
                           May 5, 2006 by and among Tecumseh Products Company
                           and certain Lenders and Issuers listed therein and
                           Citicorp USA, Inc. as Administrative Agent and
                           Collateral Agent

                  4.2      Amendment No. 1 to Second Lien Credit Agreement dated
                           May 5, 2006 by and among Tecumseh Products Company
                           and certain Lenders listed therein and Citicorp USA,
                           Inc. as Administrative Agent and Collateral Agent

                  10.1     Management Incentive Plan as amended and restated on
                           March 29, 2006, effective as of January 1, 2005 in
                           part and as of January 1, 2006 in part (management
                           contract or compensatory plan or arrangement)

                  10.2     Executive Deferred Compensation Plan adopted on March
                           29, 2006, effective as of January 1, 2005 (management
                           contract or compensatory plan or arrangement)



                                                                         Page 30
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
                           PART II. OTHER INFORMATION


                  10.3     Director Retention Phantom Share Plan as amended and
                           restated on March 29, 2006, effective as of January
                           1, 2005 (management contract or compensatory plan or
                           arrangement)

                  31.1     Certification of the President and Chief Executive
                           Officer pursuant to Section 302 of the Sarbanes-Oxley
                           Act of 2002.

                  31.2     Certification of the Chief Financial Officer pursuant
                           to Section 302 of the Sarbanes-Oxley Act of 2002.

                  32.1     Certification of the President and Chief Executive
                           Officer pursuant to Section 906 of the Sarbanes-Oxley
                           Act of 2002.

                  32.2     Certification of the Chief Financial Officer pursuant
                           to Section 906 of the Sarbanes-Oxley Act of 2002.



                                                                         Page 31
<PAGE>

                   TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES

                                    SIGNATURE


Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                                    TECUMSEH PRODUCTS COMPANY
                                    -------------------------
                                          (Registrant)



Dated: May 9, 2006                  BY: /s/ JAMES S. NICHOLSON
       ---------------------            ----------------------------------------
                                        James S. Nicholson
                                        Vice President, Treasurer and
                                        Chief Financial Officer (on behalf
                                        of the Registrant and as principal
                                        financial officer)

                                                                         Page 32
<PAGE>
                                  Exhibit Index



ITEM 6.                 EXHIBITS

              Exhibit
     (a)       Number     Description

                4.1       Amendment No. 1 to First Lien Credit Agreement dated
                          May 5, 2006 by and among Tecumseh Products Company and
                          certain Lenders and Issuers listed therein and
                          Citicorp USA, Inc. as Administrative Agent and
                          Collateral Agent

                4.2       Amendment No. 1 to Second Lien Credit Agreement dated
                          May 5, 2006 by and among Tecumseh Products Company and
                          certain Lenders listed therein and Citicorp USA, Inc.
                          as Administrative Agent and Collateral Agent

               10.1       Management Incentive Plan as amended and restated on
                          March 29, 2006, effective as of January 1, 2005 in
                          part and as of January 1, 2006 in part (management
                          contract or compensatory plan or arrangement)

               10.2       Executive Deferred Compensation Plan adopted on March
                          29, 2006, effective as of January 1, 2005 (management
                          contract or compensatory plan or arrangement)

               10.3       Director Retention Phantom Share Plan as amended and
                          restated on March 29, 2006, effective as of January 1,
                          2005 (management contract or compensatory plan or
                          arrangement)

               31.1       Certification of the President and Chief Executive
                          Officer pursuant to Section 302 of the Sarbanes-Oxley
                          Act of 2002.

               31.2       Certification of the Chief Financial Officer pursuant
                          to Section 302 of the Sarbanes-Oxley Act of 2002.

               32.1       Certification of the President and Chief Executive
                          Officer pursuant to Section 906 of the Sarbanes-Oxley
                          Act of 2002.

               32.2       Certification of the Chief Financial Officer pursuant
                          to Section 906 of the Sarbanes-Oxley Act of 2002.