The funded status of Ford Motor Co.'s pension plans dramatically improved in 2013, the big automaker reported Tuesday.

At year-end 2013, Ford's pension plans worldwide were underfunded by $9 billion, compared with $18.7 billion at year-end 2012. In the United States, the automaker's pension plans were underfunded by $2 billion, compared with $9.7 billion a year earlier, according to financial reports released by Ford.

Ford attributed the sharp improvement in plan funding to higher interest rate assumptions, which reduced the value of plan liabilities, pumping more money into the plans, and a pension de-risking program that removed billions of dollars in obligations from its pension plan offered to salaried employees.

Under that program, which was unveiled in April 2012 and ended last year, Ford offered more than 90,000 U.S. salaried retirees and former employees the opportunity to take their monthly benefit as a cash lump-sum payment.

In all, about 35,000 plan participants accepted the offer, removing $4.2 billion in pension plan liabilities, the company reported earlier.

Since Ford launched that trailblazing program, more than a dozen other major employers, including rival automaker General Motors Co., instituted similar annuity to lump-sum benefit conversion programs.

Through such de-risking programs, employers reduce the size of their pension plan obligations, cutting back their exposure to swings in interest rates and investment results that can make it difficult for them to project future contributions.

%%BREAK%%

Ford sharply boosted contributions to its pension plans in 2013, pumping in $5 billion, up from $3.4 billion in 2012. But due to the improvement in their funding levels, Ford said it expects to contribute $1.5 billion to its pension plans in 2014, a $3.5 billion reduction from 2013.

Ford, though, did not disclose its pension plans' assets and liabilities. Such disclosure will come in several weeks when the automaker releases its 10-K report for 2013.

At year-end 2012, Ford's U.S. pension plans — including plans covering salaried and union employees and retirees — had a funded ratio of 81.3%, with $42.40 billion in assets and $52.13 billion in liabilities. That compares with a funded ratio of 80.7% at year-end 2011, when the U.S. plans had $39.41 billion in assets and $48.82 in billion in liabilities.