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Ford's pension plans hit by declining interest rates

Ford's pension plans hit by declining interest rates

DEARBORN, Mich.—The funding level status of Ford Motor Co.'s U.S. pension plans declined in 2011, as declining interest rates boosted the value of plan liabilities.

At year-end 2011, the plans had a funded ratio of 80.7%, with $39.41 billion in assets and $48.82 billion in liabilities. That compares with a funded ratio of 85.8% at year-end 2010, when the U.S. plans had $39.96 billion in assets and $46.65 in billion in liabilities, the automaker disclosed Wednesday in its 10-K annual report filed with the U.S. Securities and Exchange Commission.

As previously reported, Ford contributed $1.1 billion to its plans within and outside the United States in 2011 and expects to contribute $3.5 billion to its plans, including $2 billion to its U.S. pension plans, in 2012.

Ford said part of its long-term strategy to reduce risk posed by its pension plans is to shift more assets into fixed income investments and away from equities.