CNH THIRD QUARTER 2007 NET INCOME UP 82 PERCENT FROM 2006

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  •  Third quarter diluted EPS of $0.51 up 82% from 2006
  •  First 9 months diluted EPS of $1.87 up 72% from 2006  
  •  Equipment Operations third quarter gross margin up 1.9 percentage points
  •  CNH Equipment Operations remains net debt free at end of third quarter
  •  Full year 2007 financial outlook increased, with an expected range of diluted EPS, exclusive of restructuring, forecast at $2.55 to $2.60
 
BURR RIDGE, Illinois (October 23, 2007) ? CNH Global N.V. (NYSE:CNH) today reported third quarter 2007 net income of $122 million, up 82 percent compared to net income of $67 million in the prior year. Results include restructuring charges, net of tax, of $26 million in the third quarter of 2007, compared with $4 million in 2006. Net income excluding restructuring charges, net of tax, was $148 million, up 108 percent compared to $71 million in the prior year. Third quarter diluted earnings per share were $0.51, compared with $0.28 per share in 2006. Before restructuring, net of tax, third quarter diluted earnings were $0.62 per share, compared with $0.30 per share in the prior year.
 
For the first nine months of 2007, net income of $445 million was up 73 percent compared to net income of $257 million in 2006. Results include restructuring charges, net of tax, of $55 million in the first nine months of 2007, compared with $13 million in the prior year. Net income excluding restructuring charges, net of tax, was $500 million in the September year-to-date period, up 85 percent compared to $270 million in 2006. First nine months diluted earnings per share were $1.87, compared with $1.09 per share in the prior year. Before restructuring, net of tax, September year-to-date diluted earnings were $2.10 per share, compared with $1.15 per share in 2006.
 
?Our Equipment Operations gross margin rose 1.9 percentage points to 19.4%, compared with the third quarter last year ? our ninth consecutive quarter of year-over-year gross margin improvement.  Our industrial operating margin rose 2.5 percentage points to 8.4%, making it the best third quarter margin in CNH?s history,? said Harold Boyanovsky, CNH President and Chief Executive Officer. ?Our growth in the quarter exceeded industry performance, as our actions to revitalize our brands, enhance our customer and quality focus, and leverage our global footprint continue to gain traction. We are increasing our full year 2007 financial outlook with an expected range of diluted EPS, excluding restructuring, forecast at $2.55 to $2.60."
 
Highlights for the quarter include:
? Worldwide CNH agricultural retail unit volumes showed particular strength in higher horsepower tractors and combines, with increased agricultural industry demand throughout the Americas and Western Europe.
? Worldwide construction equipment industry and CNH retail unit sales were up, with sales outside of North America showing continued strength, more than compensating for weaker industry unit sales in North America.
? Higher economic-related cost increases, primarily on steel-based products, were offset by positive impacts of exchange rate changes, driving another quarter of positive net price recovery. 
? Equipment Operations remained in a Net Cash position throughout the quarter.  During the quarter the company fully redeemed $1.05 billion of 9 ¼% Senior Notes due 2011, allowing CNH to improve its balance sheet structure and better manage its liquidity. Pre-tax redemption costs of $57 million ($0.15 per diluted share, net of tax) were incurred in the quarter.
? CNH, in September, submitted a response in a consolidated arbitration proceeding pending in London before the ICC International Court of Arbitration and booked a provision of $45 million.  This cost was included in CNH?s third quarter results, reducing its reported diluted earnings per share, net of tax, by $0.12 for the quarter.
? In the third quarter, the company revised its forecast annual consolidated effective tax rate from approximately 40% to 37%, principally due to stronger earnings in certain jurisdictions where no previous tax benefit has been recognized, change in the mix of income from generally higher tax jurisdictions to relatively lower tax jurisdictions, and tax credits and incentives, resulting in a consolidated effective tax rate of 25.9% for the three months ended September 30, 2007.
? In August, CNH?s Financial Services in Europe acquired sole ownership of a special purpose trust used to securitize certain wholesale receivables in Europe.  Financial Services also took over funding the trust, repaying the third party financing. The transaction was financed through an increase in a debt facility with a related party. Accordingly, Financial Services consolidated approximately $715 million of the trust?s assets and liabilities on its balance sheet as of September 30, 2007. 
? Conditions in the Brazilian agricultural equipment market have continued to improve with total tractor and combine industry unit sales up 67% compared with the third quarter of 2006 driven primarily by higher soybean and corn prices.  The Brazilian government has announced new subsidy programs to support the market but the detailed regulations have not yet been released. 

EQUIPMENT OPERATIONS ? Third Quarter Financial Results
Net sales of equipment, comprising the company?s agricultural and construction equipment businesses were $3.6 billion for 2007, compared to $2.7 billion for the same period in 2006. Net sales increased 33% including 6% related to currency.
 
Agricultural Equipment Net Sales
? Agricultural equipment net sales increased to $2.3 billion, up 36% (including 6% related to currency variations), compared with the prior year.
? Net sales were up 98% in Latin America (including 9% related to currency variations), up 38% in North America (including 1% related to currency variations), up 26% in Rest-of-World markets (including 8% related to currency variations) and up 25% in Western Europe (including 9% related to currency variations).
 
Construction Equipment Net Sales
? Construction equipment net sales increased to $1.3 billion, up 28% (including 6% related to currency variations), compared to the prior year.
? Net sales were up 95% in Rest-of-World markets (including 7% related to currency variations), up 69% in Latin America (including 9% related to currency variations), up 39% in Western Europe (including 8% related to currency variations) but down 7% in North America (including positive 1% related to currency variations).
 
Gross Margin
Equipment Operations gross margin (defined as net sales of equipment less cost of goods sold) for agricultural and construction equipment increased by 47% to $689 million, compared to the third quarter of 2006. As a percent of net sales, gross margin increased 1.9 percentage points to 19.4 %.
? Agricultural equipment gross margin increased in both dollars and as a percent of net sales compared to the prior year.  Higher volumes, better mix and improved quality costs were the primary contributors.
? Construction equipment gross margin increased both in dollars and as a percent of net sales compared to the prior year.  Positive industry and retail performance outside of North America and positive net price recovery were offset by effects of the decline in the North American industry.
 
Industrial Operating Margin
Equipment Operations industrial operating margin (defined as net sales of equipment, less cost of goods sold, SG&A and R&D costs) increased 90% to $300 million, or 8.4% of net sales, compared to $158 million or 5.9% of net sales in the third quarter of 2006. The higher gross margin noted above drove the improvement. SG&A costs increased for exchange rate changes, economics, and investments in enhanced customer care and incentive compensation programs.  R&D costs also increased in dollars, however, as a percent of net sales, both SG&A and R&D costs declined, compared with the third quarter last year.
 
FINANCIAL SERVICES ? Third Quarter Financial Results
Financial Services operations reported a 16% year-over-year increase in net income, to $72 million, its best quarterly result in its history. The increase reflected the impact of higher balances of receivables under management across every region, partially offset by lower gains on a smaller retail ABS transaction. In Brazil, where the details of the new governmental program supporting the agricultural market have not yet been released, the government decreed moratorium on repayments of retail financing obligations has been continued until those detailed regulations are issued. This payment moratorium affects approximately one-half of our Brazilian Financial Services operations $1.7 billion portfolio of agricultural equipment financings. CNH believes that the detailed regulations will be issued shortly and the new support programs, which will be beneficial to CNH?s operations, will be implemented before year-end.
 
EQUIPMENT OPERATIONS ? First Nine Months Financial Results
Net sales of equipment, comprising the company?s agricultural and construction equipment businesses were $10.9 billion for 2007, compared to $9.1 billion for the same period in 2006. Net sales increased 19% including 5% related to currency.
 
Agricultural Equipment Net Sales
? Agricultural equipment net sales increased to $7.2 billion, up 22% (including 5% related to currency variations), compared with the prior year.
? Net sales were up 81% in Latin America (including 7% related to currency variations), up 28% in Rest-of-World markets (including 6% related to currency variations), up 24% in Western Europe (including 9% related to currency variations) and up 10% in North America (with no impact from currency variations).
 
Construction Equipment Net Sales
? Construction equipment net sales increased to $3.7 billion, up 15% (including 5% related to currency variations), compared to the prior year.  
? Net sales were up 85% in Rest-of-World markets (including 7% related to currency variations), up 46% in Latin America (including 7% related to currency variations), up 40% in Western Europe (including 8% related to currency variations) but down 21% in North America (with no impact from currency variations).
 
Gross Margin
Equipment Operations gross margin for agricultural and construction equipment increased 29% to $2.1 billion, compared to the first nine months of 2006. As a percent of net sales, gross margin increased 1.5 percentage points to 19.5%.
? Agricultural equipment gross margin increased both in dollars and as a percent of net sales compared to the prior year.  Higher volumes and better mix, positive net price recovery and reduced quality costs were the primary contributors to the improvement.
? Construction equipment gross margin also increased both in dollars and as a percent of net sales compared to the prior year. Positive industry and retail performance outside of North America, positive net price recovery and reduced quality costs were offset by effects of the industry decline in North America and CNH?s actions to reduce dealer inventories.
 
Industrial Operating Margin
Equipment Operations industrial operating margin increased 51% to $960 million, or 8.8% of net sales, compared to $636 million or 7.0% of net sales in the first nine months of 2006. The higher gross margin noted above drove the improvement. SG&A and R&D costs increased in dollars, but declined slightly as a percent of net sales. 
 
FINANCIAL SERVICES ? First Nine Months Financial Results
Financial Services operations reported a 20% year-over-year increase in net income, to $195 million, reflecting the impact of higher balances of receivables under management across every region.  As a partial offset, Financial Services recorded lower gains on retail ABS transactions and increases in SG&A costs.
 
NET DEBT (CASH) AND OPERATING CASH FLOW
Equipment Operations Net Debt (Cash) position (defined as total debt less cash and cash equivalents, deposits in Fiat affiliates cash management pools and intersegment notes receivables) was Net Cash of $413 million on September 30, 2007 compared to Net Cash of $531 million on June 30, 2007 and to Net Debt of $263 million on December 31, 2006.
 
In the quarter, Equipment Operations Net Cash decreased by $118 million. Operating activities used $120 million of cash in the quarter, as cash generated from earnings was offset by seasonal changes in other assets and liabilities and increases in working capital. Working Capital (defined as accounts and notes receivable, excluding inter-segment notes receivable, plus inventories less accounts payables), net of currency variations, increased by $123 million in the quarter. Capital expenditures, in the quarter, were $80 million. Year-to-date, Equipment Operations Net Debt has been reduced by $676 million, driven by $793 million of cash generation from operating activities, primarily earnings.
At incurred currency rates, Equipment Operations working capital on September 30, 2007 was $2,291 million, up $186 million from $2,105 million at June 30, 2007.
 
On August 1, 2007, Case New Holland, Inc. redeemed the full $1.05 billion aggregate principal amount of its outstanding 9 ¼% Senior Notes due 2011, with a combination of cash and term financings from Fiat Finance North America.  Rubin McDougal, CNH?s Chief Financial Officer, said that ?the action improves CNH?s balance sheet structure while reducing interest expense and will have a net positive earnings impact over time, allowing CNH to better manage its liquidity.?  The decision to redeem the notes was facilitated by Standard and Poor?s raising of CNH?s credit rating to BB+, with a positive outlook, at the end of May.  Third quarter charges to redeem the notes and write-off remaining unamortized issuance costs totaled $57 million. 
 
Financial Services Net Debt increased by $748 million to $7,409 million on September 30, 2007 from $6,661 million on June 30, 2007, driven primarily by higher levels of receivables.
 
THIRD QUARTER 2007 BRAND ACTIVITIES
New Holland Agricultural Equipment had multiple product launches, including T9000 series 4-wheel-drive tractors; T8000 series row crop tractors; BR7000 series round balers; a powerful line of H8000 Speedrower? self-propelled windrowers in North America and three higher horsepower CR9000 combine models in Europe. It also expanded its forage harvester and telehandler lineups.
 
New Holland Construction Equipment strengthened its position by launching new telehandlers, excavators and wheel loaders with improved durability and reliability.
 
Case IH Agricultural Equipment began shipping its pace-setting Module Express? 625 cotton picker/packager during the third quarter. The environmentally friendly equipment allows farmers to pick, transfer and pack cotton on a single machine without requiring additional investments by the cotton gins to process the bales. The brand also launched new models of the Steiger® and Quadtrac® four-wheel-drive tractors, the largest in its portfolio, and a new line of tillage tools.
 
Case Construction Equipment launched the 621E wheel loader featuring greater horsepower with increased fuel efficiency and an enhanced ergonomically designed cab with improved worksite visibility and a quieter operator environment.
 
Case IH expanded its ?SERVICE MAX? program from Europe to added North American customers. This 24-hour-a-day/7-day-a-week service provides dealer back-up for after-sales support, dealer contact information, technical service and breakdown assistance including parts procurement from depots, plants and suppliers.
 
New Holland Agricultural Equipment introduced ?TOP SERVICE? to the U.S. market, an industry-leading customer support program with company technical experts and parts and logistics specialists working in tandem with the New Holland dealer network, expanding the program piloted in western Canada and Europe earlier in the year.
 
AGRICULTURAL EQUIPMENT MARKET OUTLOOK
CNH expects U.S. net farm income in 2007 to be significantly higher than in 2006, bolstered by higher corn, wheat, soybean and cotton prices. The North American market for over-40 horsepower tractors performed better than expected in the third quarter. For the full year, CNH expects North American industry retail sales of over-40 horsepower tractors to be up 5 to 10%, compared with 2006, with sales of over-140 horsepower tractors up about 15%. We expect industry retail unit sales of combines in North America to be up 5 to 10% compared with 2006.
 
Outside of North America, for the full year, we continue to expect industry retail unit sales of tractors to be flat to up slightly, compared with 2006, with particular strength in the Latin American market which CNH now expects to be up 35 to 40%. We expect tractor industry unit sales in Western Europe to be up as much as 5% compared with 2006, with sales in Rest-of-World markets flat to down slightly from 2006 levels.  
 
We expect the worldwide industry unit retail sales of over-40 horsepower agricultural tractors to be up, as much as 5% compared with 2006, although we expect industry unit sales of under-40 horsepower tractors in North America to be down as much as 5%. In total, CNH expects worldwide agricultural tractor industry unit volumes to be up slightly compared with 2006. We expect that combine sales could be up about 15% compared with 2006, an improvement from our prior outlook.
 
CONSTRUCTION EQUIPMENT MARKET OUTLOOK
For the full year, CNH expects North American industry retail unit sales of both heavy and light construction equipment to be down 10 to 15% compared with 2006. North American industry sales of both heavy and light construction equipment continued weakening in the third quarter, as housing starts and activity levels declined. 
 
For the year, CNH expects both heavy and light construction equipment industry retail unit sales outside of North America to be up significantly, more than offsetting the decline in North America, following the pattern of the first nine months of the year. CNH expects industry sales of total heavy and light equipment to be up about 15% in Western Europe, up between 30 and 35% in Latin America and up 25 to 30% in Rest-of-World markets.
 
In total, CNH expects worldwide industry retail unit sales of both heavy and light construction equipment to be up about 10% compared with 2006.
 
CNH OUTLOOK FOR FULL YEAR 2007
Based on these agricultural and construction equipment market outlooks and the initiatives undertaken in the last two years designed to properly position our four main brands, CNH anticipates that 2007 diluted earnings per share, before restructuring, net of tax, should be in the range of $2.55 to $2.60, compared with $1.53 for the full year 2006.
 
Restructuring costs, net of tax, in 2007 are expected to be about $90 million primarily related to previously announced actions and the pending arbitration proceeding.
 
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CNH Global N.V. is a world leader in the agricultural and construction equipment businesses. Supported by about 11,500 dealers in 160 countries, CNH brings together the knowledge and heritage of its Case and New Holland brand families with the strength and resources of its worldwide commercial, industrial, product support and finance organizations. CNH Global N.V., whose stock is listed at the New York Stock Exchange (NYSE:CNH), is a majority-owned subsidiary of Fiat S.p.A. (FIA.MI). More information about CNH and its Case and New Holland products can be found online at www.cnh.com.
  
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CNH management will hold a conference call later today to review its third quarter 2007 results. The conference call Webcast will begin at approximately 9:00 a.m. U.S. Central Time; 10:00 a.m. U.S. Eastern Time. This call can be accessed through the investor information section of the company's Web site at www.cnh.com and is being carried by CCBN.
 
 
Forward-looking statements. This press release includes ?forward-looking statements? within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact contained in this press release, including statements regarding our competitive strengths, business strategy, future financial position, budgets, projected costs and plans and objectives of management, are forward-looking statements. These statements may include terminology such as ?may,? ?will,? ?expect,?, ?could?, ?should,? ?intend,? ?estimate,? ?anticipate,? ?believe,? ?outlook,? ?continue,? ?remain,? ?on track,? ?goal,? or similar terminology.

Our outlook is predominantly based on our interpretation of what we consider key economic assumptions and involves risks and uncertainties that could cause actual results to differ. Crop production and commodity prices are strongly affected by weather and can fluctuate significantly. Housing starts and other construction activity are sensitive to interest rates and government spending. Some of the other significant factors for us include general economic and capital market conditions, the cyclical nature of our business, customer buying patterns and preferences, foreign currency exchange rate movements, our hedging practices, our customers? access to credit, actions by rating agencies concerning the ratings of our debt securities and asset backed securities, risks related to our relationship with Fiat S.p.A., political uncertainty and civil unrest or war in various areas of the world, pricing, product initiatives and other actions taken by competitors, disruptions in production capacity, excess inventory levels, the effect of changes in laws and regulations (including government subsidies and international trade regulations), the results of legal proceedings (including the ultimate outcome of the pending consolidated arbitration proceeding pending in London before the ICC International Court of Arbitration), technological difficulties, results of our research and development activities, changes in environmental laws, employee and labor relations, pension and health care costs, relations with and the financial strength of dealers, the cost and availability of supplies from our suppliers, raw material costs and availability, energy prices, real estate values, animal diseases, crop pests, harvest yields, government farm programs and consumer confidence, housing starts and construction activity, concerns related to modified organisms and fuel and fertilizer costs. Additionally, our achievement of the anticipated benefits of our margin improvement initiatives depends upon, among other things, industry volumes as well as our ability to effectively rationalize our operations and to execute our brand strategy. Further information concerning factors that could significantly affect expected results is included in our Form 20-F for the year ended December 31, 2006.

We can give no assurance that the expectations reflected in our forward-looking statements will prove to be correct. Our actual results could differ materially from those anticipated in these forward-looking statements. All written and oral forward-looking statements attributable to us are expressly qualified in their entirety by the factors we disclose that could cause our actual results to differ materially from our expectations. We undertake no obligation to update or revise publicly any forward-looking statements.