VISTEON CORPORATION

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

To Visteon Stockholders,

      We invite you to attend our 2006 Annual Meeting of Stockholders at the Hotel du Pont. At this meeting, you and the other stockholders will be able to vote on the following proposals, together with any other business that may properly come before the meeting:

      You may vote on these proposals in person or by proxy. If you cannot attend the meeting, we urge you to vote by proxy, so that your shares will be represented and voted at the meeting in accordance with your instructions. (See the attached proxy statement for details on voting by proxy.) Of course, if you attend the meeting, you may withdraw your proxy and vote your shares. Only stockholders of record at the close of business on March 15, 2006, will be entitled to vote at the meeting or any adjournment thereof.

Van Buren Township, Michigan

March 30, 2006

CONTENTS

VISTEON CORPORATION

One Village Center Drive

Van Buren Township, Michigan 48111

PROXY STATEMENT

March 30, 2006

INTRODUCTION

      The Board of Directors is soliciting your proxy to encourage your participation in the voting at the Annual Meeting. You are invited to attend the Annual Meeting and vote your shares directly. However, even if you do not attend, you may vote by proxy. As shown in the Notice of Annual Meeting, the Annual Meeting will be held on Wednesday, May 10, 2006, at the Hotel du Pont in Wilmington, Delaware. Directions to the Hotel du Pont can be found in Appendix E.

      There are two parts to this solicitation: the proxy card and this proxy statement. The proxy card is a means by which you may actually authorize another person to vote your shares in accordance with your instructions. As described in “Voting” below, we have provided you additional methods for voting by proxy that do not require you to use the proxy card.

      This proxy statement and accompanying proxy are being distributed on or about March 30, 2006.

VOTING

How to Vote Your Shares

      You may vote your shares at the Annual Meeting in person or by proxy. To vote in person, you must attend the Annual Meeting, and obtain and submit a ballot, which will be provided at the meeting. To vote by proxy, you must do one of the following:

      By completing and submitting your proxy by any one of these means, you will direct the designated persons (known as “proxies”) to vote your shares at the Annual Meeting in accordance with your instructions. The Board has appointed James F. Palmer and Heidi A. Sepanik to serve as the proxies for the Annual Meeting.

      Your proxy will be valid only if it is received before the polls are closed at the Annual Meeting. If you do not provide voting instructions with your proxy, then the designated proxies will vote your shares for the election of the nominated directors, for the ratification of the company’s independent auditors, for approval of amendments to the director and employee equity plans, and against the shareholder proposal(s) presented. If any nominee for election to the Board is unable to serve, which is not anticipated, or if any other matters properly come before the meeting, then the designated proxies will vote your shares in accordance with their best judgment.

How to Revoke Your Proxy

      Regardless of how you submit your proxy, you may revoke your proxy at any time before it is exercised by any of the following means:

How to Vote under 401(k) Plans

      If you are a company employee participating in any of the company’s 401(k) plans, then you may be receiving this material because of shares held for you in the plan. In that case, you may use the enclosed proxy card to instruct the plan trustees how to vote those shares. The trustees will vote the shares in accordance with your instructions and the terms of the plan.

      The plan trustees may vote the shares held for you even if you do not direct them how to vote. The trustees will vote any shares for which they do not receive instructions in the same proportion as they vote the shares for which they receive instructions.

Stockholders Entitled to Vote and Ownership

      You are entitled to one vote at the Annual Meeting for each share of the company’s common stock that you owned of record at the close of business on March 15, 2006. As of March 1, 2006, the company had issued and outstanding 128,006,167 shares of common stock. Information regarding the holdings of the company’s stock by directors, executive officers and certain other beneficial owners can be found beginning on page 8.

      A list of the stockholders of record entitled to vote at the annual meeting will be available for review by any stockholder, for any purpose related to the meeting, between 9:00 a.m. and 5:00 p.m. at the principal offices of the company, located at One Village Center Drive, Van Buren Township, Michigan 48111, for ten days before the meeting.

Required Vote to Approve the Proposals

      The company’s By-Laws require that a majority of the company’s common stock be represented at the Annual Meeting, whether in person or by proxy, for a quorum which is needed to transact any business.

      Election of Directors. The affirmative vote of a plurality of the votes cast at the meeting is required for the election of directors. A properly executed proxy marked “Withhold authority” with respect to the election of one or more directors will not be voted with respect to the director or directors indicated, although it will be counted for purposes of determining whether there is a quorum.

      Other Proposals. For each proposal other than the election of directors, the affirmative vote of the holders of a majority of the shares represented in person or by proxy and entitled to vote on the item will be required for approval. A properly executed proxy marked “Abstain” with respect to any such matter will not be voted, although it will be counted for purposes of determining whether there is a quorum. Accordingly, an abstention will have the effect of a negative vote.

      If you hold your shares in “street name” through a broker or other nominee and you do not give voting instructions at least ten days before the meeting to your broker or other nominee, then your broker or other nominee may exercise voting discretion only with respect to matters considered to be “routine” by the New York Stock Exchange, such as the election of directors and the ratification of the appointment of the independent auditors. On non-routine matters, such as amending the equity plans and shareholder proposal(s), the brokers or other nominees cannot vote your shares absent voting instructions from the beneficial holder, resulting in so-called “broker non-votes.” Broker non-votes are not deemed to be votes cast, and as a result have no effect on the outcome of any matters presented, but will be counted in determining whether there is a quorum.

Where to Find Voting Results

      The company will publish the voting results in its Form 10-Q for the second quarter of 2006, which we plan to file with the Securities and Exchange Commission on or prior to August 9, 2006. You will also find the results in the investor information section of the company’s website (www.visteon.com/investors).

Cost of Solicitation

      The company will pay for soliciting these proxies. The company’s directors, officers and employees may solicit proxies in person or by telephone, mail, e-mail, telecopy or letter. The company has also retained Georgeson Shareholder Communication, Inc. to assist it in distributing proxy solicitation materials and soliciting proxies at a cost of approximately $10,000, plus reasonable out-of-pocket expenses. The company will reimburse brokers and other nominees for their reasonable out-of-pocket expenses for forwarding proxy materials to beneficial owners.

ITEM 1. ELECTION OF DIRECTORS

      The Board of Directors consists of eight directors divided into three classes (Class I, Class II and Class III) serving staggered three-year terms. The first proposal on the agenda for the Annual Meeting will be electing two directors to serve as Class III directors for a three-year term beginning at this Annual Meeting and expiring at the 2009 Annual Meeting of Stockholders. The nominees receiving the greatest number of votes cast will be elected.

      We expect each nominee for election as a director to be able to serve if elected. If any nominee is not able to serve, proxies will be voted in favor of the remainder of those nominated and may be voted for substitute nominees, unless the Board chooses to reduce the number of directors serving on the Board.

      The Board of Directors Recommends that You Vote for the Election of Charles L. Schaffer and Kenneth B. Woodrow as Class III Directors.

Nominees for Class III Directors Whose Terms Expire in 2006

      Charles L. Schaffer is 60 years old, and he has been a director of the company since January 2001. Mr. Schaffer is the former Chief Operating Officer of United Parcel Service, Inc., a global provider of package delivery services.

      Kenneth B. Woodrow is 61 years old, and he has been a director of the company since October 2004. Mr. Woodrow is the former Vice Chairman of Target Corporation, a retail sales company, a position he held from 1999 until his retirement in December 2000. Prior to that, he was the President of Target Stores since 1994. Mr. Woodrow is also a director of Delta Air Lines, Inc. and E-Z Gard Industries, Inc.

Continuing Class I Directors Whose Terms Expire in 2007

      Patricia L. Higgins is 56 years old, and she has been a director of the company since September 2004. Ms. Higgins is the former Chief Executive Officer and President of Switch and Data, a leading neutral interconnection and collocation provider, a position she held from September 2000 to February 2004. Prior to that, she was Chairman and Chief Executive Officer of The Research Board, a business unit of the Gartner Group, for which she also served as an Executive Vice President since January 1999. Ms. Higgins also serves on the board of directors of Delta Air Lines, Inc. and Internap Network Services Corporation.

      Michael F. Johnston is 58 years old, and he has been Chairman of the Board and Chief Executive Officer since June 2005, and a member of the Board of Directors since May 2002. Prior to that, he was Chief Executive Officer and President since July 2004, and President and Chief Operating Officer since joining the company in September 2000. Before joining Visteon, Mr. Johnston served as President, e-business for Johnson Controls, Inc., and previously as President-North America and Asia of Johnson Control’s Automotive Systems Group, and as President of its automotive interior systems and battery operations. Mr. Johnston is also a director of Flowserve Corporation and Whirlpool Corporation.

      Karl J. Krapek is 57 years old, and he has been a director of the company since February 2003. Mr. Krapek is the former President and Chief Operating Officer of United Technologies Corporation, a global supplier of aerospace and building systems products, a position he held from April 1999 to January 2002. Prior to that he served as President of United Technologies’ Pratt and Whitney division since 1992. Mr. Krapek also serves as a director of Delta Air Lines, Inc., Lucent Technologies Inc., Prudential Financial, Inc. and The Connecticut Bank and Trust Company.

Continuing Class II Directors Whose Terms Expire in 2008

      Marla C. Gottschalk is 45 years old, and she has been a director of the company since March 2003. Ms. Gottschalk has been the President and Chief Operating Officer of The Pampered Chef, Inc., a direct seller of kitchen tools and products, since December 2003. Prior to that she was the Senior Vice President, Financial Planning and Investor Relations for Kraft Foods, Inc. since February 2002, and before that she served as Executive Vice President and General Manager of Kraft’s Post Division, and Vice President, Marketing and Strategy for the Kraft Cheese Division.

      William H. Gray, III is 64 years old, and he has been a director of the company since June 2000. Mr. Gray has been a senior advisor at the law firm of Buchanan Ingersoll P.C. since April 2005, and Chairman of the Amani Group, a consulting and advisory firm, since August 2004. He was Chief Executive Officer and President of the United Negro College Fund from September 1991 to March 2004. Mr. Gray served as a Congressman from the Second District of Pennsylvania from 1979 to 1991, and at various times during his tenure, served as Budget Committee Chair and House Majority Whip. He also serves as a director of Dell Inc., J.P. Morgan Chase & Co., Pfizer, Inc., and Prudential Financial, Inc.

      James D. Thornton is 57 years old, and he has been a director of the company since September 2004. Mr. Thornton is the former Senior Executive Vice President and Director of Diversity, Recruitment and People Services for MBNA America Bank, N.A., a card credit lending company. Since joining MBNA in 1997, he held various leadership positions including Director of Quality Assurance and Director of Sports Marketing, Regional Director — Mid-Atlantic Region. Mr. Thornton is also chairman of the board of trustees at Talladega College.

CORPORATE GOVERNANCE

Meetings

      During 2005, the Board of Directors held ten regularly scheduled and special meetings and took action by written consent one time in lieu of an additional meeting. All of the directors attended at least 90% of all meetings of the Board and Board committees on which they served during 2005. Under the company’s Corporate Governance Guidelines, directors are expected to attend all scheduled Board and committee meetings as well as the company’s Annual Meeting of Stockholders. All of the directors attended the 2005 Annual Meeting of Stockholders.

      Pursuant to the Corporate Governance Guidelines, the non-employee directors meet without management at the end of every regularly scheduled Board meeting, and the independent directors meet without management at least once per year. The presiding director at these meetings is the most tenured non-employee director in attendance.

Director Independence

      The Board undertook its annual review of director independence in February 2006. The Board reviewed the independence guidelines (attached as Appendix A), and considered transactions and relationships between each director and any member of his or her immediate family and the company and its subsidiaries and affiliates. The purpose of this review was to determine whether any such relationships or transactions were inconsistent with a determination that a director is independent.

      As a result of this review, the Board affirmatively determined that all of the directors are independent of the company and its management under the independence guidelines adopted by the Board with the exception of Mr. Johnston, who is considered an inside director because of his employment as a senior executive of the company.

Committees

      The Board has established five standing committees. The principal functions of each committee are briefly described on the following pages. The charters of these committees are available on the company’s website (www.visteon.com/investors), and paper copies are available upon request to the Company Secretary.

      The Board of Directors has a standing Audit Committee, currently consisting of Charles L. Schaffer (Chair), Marla C. Gottschalk, Karl J. Krapek and Kenneth B. Woodrow, all of whom are considered independent under the rules of the New York Stock Exchange, SEC regulations and the independence guidelines adopted by the Board. Each of the current members of the Audit Committee is qualified as a financial expert within the meaning of applicable SEC regulations, and the Board has determined that they have accounting and related financial management expertise within the meaning of the listing standards of the New York Stock Exchange. During 2005, the Audit Committee held twenty-one regularly scheduled and special meetings. The duties of the Audit Committee are generally:

      The Audit Committee Report can be found beginning on page 29 and the Audit Committee Charter is attached as Appendix B.

      The Board also has a standing Organization and Compensation Committee, consisting of Karl J. Krapek (Chair), William H. Gray, III, Patricia L. Higgins, Charles L. Schaffer and James D. Thornton, all of whom are considered independent under the rules of the New York Stock Exchange and the independence guidelines adopted by the Board. During 2005, the Organization and Compensation Committee held eight regularly scheduled and special meetings. The duties of the Organization and Compensation Committee are generally:

      The Organization and Compensation Committee Report can be found beginning on page 24.

      The Board also has a standing Corporate Governance and Nominating Committee, consisting of William H. Gray, III (Chair), Marla C. Gottschalk, Karl J. Krapek and Kenneth B. Woodrow, all of whom are considered independent under the rules of the New York Stock Exchange and the independence guidelines adopted by the Board. During 2005, the Corporate Governance and Nominating Committee held five regularly scheduled and special meetings. The duties of the Corporate Governance and Nominating Committee are generally:

      The Board has a standing Corporate Responsibility Committee, consisting of Patricia L. Higgins (Chair) and James D. Thornton. During 2005, the Corporate Responsibility Committee held two regularly scheduled meetings. The duties of the Corporate Responsibility Committee are generally:

      The Board also recently formed a Finance Committee. The first meeting of this committee is scheduled to be held in April 2006, and its members are Marla C. Gottschalk (Chair), Patricia L. Higgins and Kenneth B. Woodrow. The duties of the Finance Committee generally are:

Director Nomination Process

      The Corporate Governance and Nominating Committee assesses all director candidates, whether submitted by management or stockholders, and makes recommendations for election. Recommendations for election are based upon the nominee’s intelligence, judgment, foresight, personal character, experience and achievements, and diversity of background and expertise, as compared to the present make-up of the Board. The Corporate Governance and Nominating Committee has the authority to retain independent consultants to assist with director recruitment. During 2005, the Corporate Governance and Nominating Committee retained, at the expense of the company, a search firm to assist with identifying and assessing potential candidates.

      Each year, the Corporate Governance and Nominating Committee reviews all eligible director candidates, including incumbents. The Committee then decides, based upon the pool of eligible candidates and the number of vacancies to be filled, whom to recommend to the Board to be nominated for election that year. The full Board reviews the Committee’s recommendations and approves the individuals to stand for election. This is the process that was used to identify and evaluate the current nominees standing for election that appear in this proxy statement.

      The Corporate Governance and Nominating Committee welcomes stockholder recommendations of director candidates. Stockholders may suggest candidates for the consideration of the Committee by submitting their suggestions in writing to the company’s Secretary, including the agreement of the nominee to serve as a director. In addition, the company’s By-Laws contain a procedure for the direct nomination of director candidates by stockholders (see page 40), and any such nomination will also be automatically submitted to the Corporate Governance and Nominating Committee for consideration. No individuals were proposed as director candidates for this Annual Meeting by any stockholder.

Director Compensation

      During 2005, directors who were not employees of the company received directors’ fees of $40,000 per year plus an additional $10,000 per year for each committee on which they served and $500 for each committee meeting they participated in ($1,000 for Audit Committee meetings). Non-employee directors may elect to defer their compensation under the Deferred Compensation Plan for Non-Employee Directors, a nonqualified benefit plan, into a unit account. Amounts deferred into the unit account are allocated based on the price of the company’s common stock at the time of deferral, and the value of this account is directly related to the performance of the company’s common stock. In addition, the company reimburses its directors for expenses, including travel, they incur in connection with attending board and committee meetings. Directors were also eligible to participate in the company’s Management Lease Car Program, which offers favorable lease rates and includes all maintenance and insurance costs.

      In 2005, the non-employee directors also received a grant of 3,000 shares of restricted common stock under the Restricted Stock Plan for Non-Employee Directors and an award of stock units valued at $10,000 pursuant to the terms of the Non-Employee Director Stock Unit Plan. The restrictions on shares of restricted common stock expire for one third of the shares of common stock each year following the year of grant. Also, see “Item 4 — Approval of Amendment to the Visteon Corporation Non-Employee Director Stock Unit Plan” below.

      The following chart lists total compensation paid to the non-employee directors for service during 2005.

2005 Total Compensation of Non-Employee Directors

     Beginning in 2006, non-employee directors will receive an annual retainer of $70,000 and, subject to shareholder approval at the Annual Meeting, an annual restricted stock unit award of $70,000. Committee chairs and Audit Committee members will receive an additional annual committee retainer of $10,000, except the Chair of the Audit Committee who will receive $15,000.

      To further link director and stockholder interests, the company has established stock ownership guidelines for non-employee directors. Each non-employee director has a goal to own 15,000 shares of common stock within five years of their appointment as a director.

Stockholder Communications with the Board of Directors

      Stockholders interested in communicating directly with a committee chairperson or with the non-management directors as a group may do so as described on the company’s website (www.visteon.com/investors), or by writing to the chairperson or non-management directors c/o of the Company Secretary, One Village Center Drive, Van Buren Township, Michigan 48111.

STOCK OWNERSHIP

      The following contains information regarding the stock ownership of the nominees for election as directors, the directors continuing in office, the company’s executive officers and beneficial owners of more than five percent of the company’s voting securities.

      Ownership of the company’s common stock is shown in terms of “beneficial ownership.” A person generally “beneficially owns” shares if he or she has either the right to vote those shares or dispose of them. More than one person may be considered to beneficially own the same shares.

      In this proxy statement, unless otherwise noted, a person has sole voting and dispositive power for those shares shown as beneficially owned by him or her. The percentages shown in this proxy statement compare the person’s beneficially owned shares with the total number of shares of the company’s common stock outstanding on March 1, 2006 (128,006,167 shares).

Nominees, Continuing Directors and Executive Officers

      The following table contains stockholding information for the nominees for election as directors, the directors continuing in office and the company’s executive officers, and stock units credited to their accounts under various compensation and benefit plans as of March 1, 2006.

Other Beneficial Owners

      The company believes that the following table is an accurate representation of beneficial owners of more than 5% of any class of the company’s voting securities. The table is based upon reports on Schedules 13G filed with the Securities and Exchange Commission or other information believed to be reliable.

Section 16(a) Beneficial Ownership Reporting Compliance

      There was one late Form 4 filing during 2005 for James C. Orchard related to a forfeiture of stock based awards following his termination of employment with the company.

Legal Proceedings

      In early 2005, purported class and shareholder derivative actions were filed in federal and state courts in Michigan against the company, the non-employee directors and certain Named Executives. These actions include: (i) a purported class action alleging that the company, certain of its current and former officers and its independent registered public accounting firm violated federal securities laws by making materially misleading statements; (ii) purported shareholder derivative actions alleging that certain of the company’s current and former officers and directors breached their fiduciary duties in connection with the matters alleged in the securities class action discussed immediately above; and (iii) purported class actions alleging that certain current and former employees, officers and directors breached their fiduciary duties under the Employee Retirement Income Security Act by, among other things, continuing to offer the company’s stock as an investment alternative under the Visteon Investment Plan and the Visteon Savings Plan for Hourly Employees and/or failing to disclose complete and accurate information regarding the prudence of investing in the company’s stock. Pursuant to the indemnification provision contained in the company’s Amended and Restated By-laws, the company is paying the expenses (including attorneys’ fees) incurred by the defendants in defending these actions.

EXECUTIVE COMPENSATION

      This section provides summary information regarding the compensation of Michael F. Johnston, Chairman and Chief Executive Officer; Donald J. Stebbins, President and Chief Operating Officer; James F. Palmer, Executive Vice President and Chief Financial Officer; Dr. Heinz Pfannschmidt, Executive Vice President and President, Europe and South America; William G. Quigley III, Vice President, Corporate Controller and Chief Accounting Officer; and Stacy L. Fox, former Senior Vice President, Corporate Transactions and Legal Affairs (the “Named Executives”).

Summary Compensation Table

      The following table summarizes compensation information for the Named Executives for each of our past three fiscal years.

Stock Options and Stock Appreciation Rights

      The Visteon Corporation 2004 Incentive Plan permits grants of stock options, stock appreciation rights, restricted stock, restricted stock units and other rights relating to our common stock. In general, whether exercising stock options or stock appreciation rights is profitable depends on the relationship between the common stock’s market price and the exercise price of the stock option or stock appreciation rights. Stock options or stock appreciation rights which are “in the money” on a given date can be “out of the money” if stock prices change on a subsequent date. We therefore believe that placing a current value on outstanding options is highly speculative and may not represent any benefit realized by the option holder.

      The following table gives more information regarding stock options and stock appreciation rights granted to each of the Named Executives in 2005.

Option/ SAR Grants in 2005(1)

     The following table provides information concerning the number of securities underlying unexercised stock options and stock appreciations rights, as well as the value of certain unexercised stock options and stock appreciations rights (using the closing price of our common stock as reported on the New York Stock Exchange as of December 31, 2005, less the applicable exercise price or prices), held by each of the Named Executives as of December 31, 2005.

Aggregated Option/ SAR Exercises in 2005 and

December 31, 2005 Option/ SAR Values(1)

     The following table summarizes information as of December 31, 2005 relating to Visteon’s equity compensation plans pursuant to which grants of stock options, stock appreciation rights, stock rights, restricted stock, restricted stock units and other rights to acquire shares of its common stock may be made from time to time.

Equity Compensation Plan Information

2005 — 2007 Long-Term Incentive Program

      In 2005, the company implemented a long-term incentive program for the 2005-2007 performance period for eligible employees, including the Named Executives, in accordance with the Visteon Corporation 2004 Incentive Plan. Awards under the 2005-2007 long-term incentive program are based on a predetermined percentage of an employee’s base salary and are comprised of several components designed to retain key employees and to further align the interests of employees with Visteon’s long-term business objectives and the interests of stockholders. For the Named Executives, a half of their total 2005-2007 long-term incentive award was awarded in the form of stock options and restricted stock units, which are included in the “Summary Compensation Table” above, and a quarter of their total program award is awarded in the form of a performance cash bonus opportunity. The amount to be paid relating to this performance cash bonus opportunity will be based on Visteon’s performance relative to target return on assets and product quality ratings metrics at the end of the 2005-2007 performance period, with each metric having equal weighting. If less than the target performance metrics are achieved, a performance cash award will be payable only if either approximately 10% of the return on assets metric is achieved or approximately 80% of the product quality ratings metric is achieved.

      In the table below, the “Threshold” amounts assume that minimum performance goals for return on assets and quality have been achieved. Participants may also receive cash payments in excess of the target amounts if the performance goals are exceeded. In the table below, the “Maximum” amounts assume that 200% of the target return on assets metric is achieved and 120% of the product quality ratings metric is achieved. The plan limits the amount payable in respect of performance cash awards to any Named Executive during any calendar year to $10 million.

Long-Term Incentive Plans — 2005 Awards

     In addition, a quarter of the total 2005-2007 long-term incentive program opportunity was awarded in the form of a cash bonus that will be paid in equal installments after the conclusion of each of the three years of the performance period so long as such employee continues to be employed in good standing as of such dates. The purpose of this bonus award was to retain key members of management as the company undergoes structural changes to its business model. Amounts earned by the Named Executives for 2005 are included in the “Summary Compensation Table” above.

Deferred Compensation Plan

      Prior to June 2005, U.S. based executive officers were eligible to defer up to 50% of their base salary and up to 100% of bonuses under the Visteon Deferred Compensation Plan. Amounts deferred into the Visteon stock fund of the plan were allocated based on the price of the company’s common stock at the time of deferral, and the value of this account is directly related to the performance of the company’s common stock. Amounts deferred under the plan are generally payable in a year specified by the employee at the time of deferral or, if earlier, on or after the first day of the seventh month following termination of employment. In June 2005, the plan was closed to further deferrals.

Retirement Benefits

      The company maintains the Visteon Corporation Pension Plan (the “VPP”), a defined benefit plan qualified under Section 401(a) of the Internal Revenue Code (the “Code”). It covers primarily salaried employees of the company not covered by another pension plan. The non-contributory feature of the VPP automatically covers all eligible employees. The non-contributory feature of the VPP provides a monthly benefit, payable in the form of a life annuity, equal to a flat rate times years of employment. The highest flat rate in effect on December 31, 2005 is $47.45. Participants who satisfy the requirements for early retirement, age 55 with 10 years of service or 30 years of service, are eligible for an additional, temporary monthly benefit payable until age 62. Following three months of employment, a participant may elect to be covered by the contributory feature of the plan and receive a contributory benefit in lieu of the non-contributory benefit. The contributory benefit, payable in the form of a life annuity, is equal to 1.5% of Final Average Monthly Salary times years of employment while a contributory participant plus 0.4% of Final Average Monthly Salary in excess of the Social Security Breakpoint times years of employment (not to exceed 35 years) while a contributory participant. Final Average Monthly Salary is the highest average monthly salary paid as of any five consecutive December 31 dates during the last 120 consecutive months that an employee contributes. The Social Security Breakpoint is equal to 150% of the average of the Social Security Wage Base for the last 35 years including the current plan year. Normal retirement is age 65 and portions of early retirement benefits are available at age 62 unreduced for age. Projected contributory benefits payable at age 65 under the current formula are shown in Table 1-A.

      Credited service earned under the non-contributory and contributory features of the plan will cease as of June 30, 2006. If the employee was contributing to the plan as of June 30, 2006, future December 31 base pay will continue to be recognized for purposes of determining the Final Average Monthly Salary. Early retirement supplements payable to age 62 will not be a feature of the plan for employees whose last day of employment is on or after July 1, 2006. Effective July 1, 2006, salaried employees will accrue monthly cash balance benefits under the pension plan. The Cash Balance benefit is based on a hypothetical account which grows with 4% pay credits and interest credits based on the 30-year Treasury bond rate. The monthly benefit payable from the cash balance feature is reduced for early commencement if payment begins before age 65.

      Salaried employees hired on or after January 1, 2002 participate in the VPP BalancePlus Program, a feature of the VPP. The monthly benefit payable from the BalancePlus Program is based on the greater of the Cash Balance benefit or the Pension Equity benefit. The Cash Balance benefit is based on a hypothetical account which grows with 4% pay credits and interest credits based on the 30-year Treasury bond rate. The Pension Equity benefit is based on a hypothetical account at age 65 equal to 12.5% of Final Average Monthly Salary times credited service. Projected benefits payable at age 65 under the current BalancePlus formula are shown in Table 1-B. Credited service earned under the Pension Equity feature of the plan will cease as of June 30, 2006, although changes in base pay will continue to be recognized for purposes of determining the Final Average Monthly Salary. The monthly benefit payable from the BalancePlus Program is reduced for early commencement if payment begins before age 65.

      Since the VPP is a qualified plan, it is subject to the rules of the Code. The Code limits the amount of benefits that may be paid by a qualified plan and it limits the amount of Salary that may be recognized in computing plan benefits. In 2005, the maximum annual salary the plan may recognize is $210,000.

      Visteon also has implemented the Pension Parity Plan (“PPP”), an unfunded, non-qualified pension plan. The PPP restores any benefits lost due to the limitations on benefits and compensation imposed by the Code. The qualified plan changes that take effect on July 1, 2006 also apply to the Pension Parity Plan.

Table 1-A

Projected Total Annual Retirement Benefits

From the Visteon Corporation Pension Plan

and the Pension Parity Plan

(Salaried Employees Hired Prior to January 1, 2002,

Includes all Credited Service Earned Before July 1, 2006)

Table 1-B

Projected Total Annual Retirement Benefits

From the Visteon Corporation Pension Plan BalancePlus Program

and the Pension Parity Plan

(Salaried Employees Hired on or After January 1, 2002,

Includes all Credited Service Earned Before July 1, 2006)

      Visteon provides a non-qualified, unfunded pension benefit under the Supplemental Executive Retirement Plan (“SERP”) to certain eligible executives. For eligible executives hired prior to January 1, 2002, the SERP provides an additional monthly benefit, in the form of a life annuity, equal to the participant’s Final Average Monthly Salary (without regard to the Code compensation limit) times years of employment times a percentage determined by job classification at retirement. The percentages range between 0.20% and 0.90%. Projected benefits payable at age 65 under the current SERP formula are shown in Table 2-A. Credited service earned under the SERP will cease as of June 30, 2006. Effective July 1, 2006, eligible executives will accrue SERP benefits under a formula used for eligible executives hired on or after January 1, 2002, as described in the following paragraph.

      Eligible executives hired on or after January 1, 2002 participate in the “BalancePlus SERP” feature of the SERP. The BalancePlus SERP provides an additional monthly benefit based upon a hypothetical account balance that is in excess of the amount calculated under the VPP BalancePlus Program and the Pension Parity Plan. The account balance from the BalancePlus SERP before offset is calculated under the formulas in the BalancePlus Program with the following modifications: 1) Annual Salary is calculated without regard to the Code compensation limit; 2) Final Average Monthly Salary is increased by the average of the three highest consecutive Annual Incentive amounts; and 3) a 15% benefit multiplier is used under the Pension Equity formula in lieu of the 12.5% benefit multiplier. The Pension Equity account under the BalancePlus SERP has its own early retirement reduction factors, which are applied at early retirement before offsetting the amount calculated under the BalancePlus Program and the Pension Parity Plan. The additional monthly benefit is payable in the same form as paid under the BalancePlus Program. Projected benefits payable at age 65 under the current BalancePlus SERP are shown in Table 2-B.

Table 2-A

Projected Total Annual Retirement Benefits

From the Supplemental Executive Retirement Plan

(Salaried Employees Hired Prior to January 1, 2002,

Includes all Credited Service Earned Before July 1, 2006)

Table 2-B

Projected Total Annual Retirement Benefits

From the Supplemental Executive Retirement Plan

(Salaried Employees Hired on or After January 1, 2002,

Includes all Credited Service Earned Before July 1, 2006)

Annuity Based on GAR94 Unisex Table and 5% Interest.

Target Bonus of 80% of Base Pay Assumed/ 50% Payout of Target Bonus

      Visteon provides a non-qualified, unfunded temporary pension from the Executive Separation Allowance Plan (“ESAP”) to eligible executives who separate employment under certain circumstances. For eligible executives hired prior to January 1, 2002, the ESAP provides a temporary monthly benefit, payable to age 65, equal to the participant’s highest base salary times a percentage, not to exceed 60% equal to the sum of i) 15%, ii) 6% for each year that such participant’s age at separation exceeds 55 (not to exceed 30%), and iii) 1% for each year of service in excess of 15. This amount is offset by any payments paid or payable from any other private retirement plan of the company other than the SERP. Executives hired on or after January 1, 2002, or who were promoted to the level of an eligible executive after June 30, 2004, are not eligible to participate in the ESAP. Projected ESAP benefits payable commencing at age 55 are shown in Table 3-A. Projected ESAP benefits commencing at age 60 are shown in Table 3-B.

Table 3-A

Projected Total Annual Retirement Benefits

From the Executive Separation Allowance Plan

Assuming Benefits Commence at Age 55

Table 3-B

Projected Total Annual Retirement Benefits

From the Executive Separation Allowance Plan

Assuming Benefits Commence at Age 60

      The table below shows the years of credited service earned by the Named Executives under the Visteon retirement plans as of December 31, 2005:

     Visteon Holdings GmbH, an indirect, wholly owned subsidiary of the company, has agreed to provide Dr. Pfannschmidt with a pension payable as a 60% joint and survivor annuity commencing at age 65 equal to 0.5% of final five year average annual base compensation up to the Final Average Social Security Contribution Ceiling (“SSCC”), plus 1.5% of final five year average annual base compensation in excess of SSCC times years of pensionable service. Early retirement benefits are payable commencing after age 55, reduced by 4.8% for every year before age 62. In the event of disability or pre-retirement death, the pension would be calculated by projecting service to age 65. In addition to the 60% survivor annuity, ancillary orphan’s benefits are also provided. As of December 31, 2005, Dr. Pfannschmidt had earned 4.167 years of pensionable service.

Table 4

Projected Annual Retirement Benefits

for Dr. Heinz Pfannschmidt

      The company will provide an executive retiree health care benefit upon their retirement from the company for designated executives. Pursuant to the program, such executives will be entitled to retiree health care benefits after completing 5 years of service with the company that are similar to those available to the company’s employees who are eligible under the Visteon Retiree Medical Plan. Messrs. Johnston, Stebbins and Palmer are eligible for this program.

      The Named Executives, as well as most U.S. salaried employees, are entitled to participate in the Visteon Investment Plan (“VIP”), Visteon’s 401(k) investment and savings plan. Prior to 2006, Named Executives, as well as other U.S. salaried employees, also participated in the Visteon Savings Parity Plan (“VSPP”), pursuant to which Visteon provided benefits substantially equal to benefits that could not be provided under the VIP because of limitations under the Code. In December 2005, the VSPP was terminated and all accrued benefits were distributed to participants.

Employment Arrangements

      Agreement with Mr. Johnston. In 2000, the company entered into an employment agreement with Michael F. Johnston that provides terms of employment, compensation, incentive plan compensation, benefits and perquisites, pensions, employment termination, non-competition and confidentiality, and “change in control” provisions. Mr. Johnston’s agreement is extended automatically each year unless, not later than ninety days prior to each such date, the company or Mr. Johnston shall have given notice not to extend the term. The agreement also may be terminated under certain specified circumstances including the termination by either party upon 90 days notice.

      Agreement with Mr. Stebbins. The company entered into a letter agreement effective as of May 23, 2005 (the “Effective Date”), with Mr. Stebbins that provides for the terms of his employment as President and Chief Operating Officer. The letter agreement provides that Mr. Stebbins will receive an initial annual base salary of $850,000 and an initial payment of $3,000,000, which may be refundable on a pro rata basis if his employment is terminated for “Cause” or without “Good Reason” (each as defined therein) prior to the third anniversary of the Effective Date. Mr. Stebbins is also entitled to participate in the company’s annual incentive performance cash bonus program, with a guaranteed minimum payment of $807,500 for 2005, and the company’s long-term incentive program, with pro-rata payments for the 2004-2006 and 2005-2007 performance periods.

      Mr. Stebbins will be credited with two years of benefit service for each one year of actual benefit service through the SERP. In addition, the company will credit Mr. Stebbins with an opening balance in the SERP of $1,200,000.00. Mr. Stebbins’ aggregate accrued benefit payable from all qualified and nonqualified retirement plans upon retirement from the company will not be less than the greater of the actuarial equivalent value of (a) the aggregate benefit payable to him under the VPP, the SERP, and the PPP minus the $1,200,000.00 opening balance and interest credits attributable thereto or (b) the $1,200,000.00 SERP opening balance plus interest credits accrued to the date of retirement. Mr. Stebbins will forfeit the aforementioned benefits if, prior to his five year anniversary with the company he is terminated by the company for Cause (other than due to his death or “Disability”, which shall have the meaning set forth in the long term disability benefit plan of the company in which Mr. Stebbins participates), or he terminates employment with the company for other than Good Reason.

      The letter agreement has a term of two years, with the agreement automatically renewable for successive one year terms unless either party gives written notice not less than 90 days prior to expiration that it/he does not wish to renew. If the company gives such notice prior to Mr. Stebbins’ 10th anniversary with the company, Mr. Stebbins shall be entitled to severance benefits upon termination of employment on the same basis as provided for a termination without “Cause” or resignation for “Good Reason” during the term of the agreement. If the company gives such notice after Mr. Stebbins’ 10th anniversary with the company, Mr. Stebbins shall not be entitled to such severance. The Executive retains the right to resign at any time for any reason, just as company retains the right to sever the employment relationship at any time, with or without Cause. However, if Mr. Stebbins is terminated by the company without Cause or resigns from the company’s employ for Good Reason during the term of the letter agreement, Mr. Stebbins will be entitled to the following separation benefits (provided Mr. Stebbins signs a release of all claims against the company and its representatives): (i) the benefits of the Executive Severance Plan; plus, (ii) should said termination without Cause or for Good Reason occur during the first 12 months of Mr. Stebbins’ employment, (A) six additional months of base salary; (B) retention (or payment) of Mr. Stebbins’ entire signing bonus; (C) prior year earned but unpaid annual and long term performance cash; and (D) pro-rata portion of current year annual and long-term performance cash.

      If the current Chief Executive Officer leaves his position for any reason on or after Mr. Stebbins’ second anniversary with the company, and another candidate is selected to fill that position, Mr. Stebbins may elect to terminate his employment within three months of such decision or appointment, and receive the severance benefits for a termination without Cause or resignation with Good Reason, as well as immediate full vesting of any outstanding stock options or stock appreciation rights and restricted stock or restricted stock units.

      Agreement with Mr. Palmer. The company entered into an “at will” employment memorandum dated as of June 2, 2004 with Mr. Palmer. The memorandum provides for his employment as Executive Vice President and Chief Financial Officer. He received an initial annual base salary for 2004 of $700,000 and a sign-on bonus of $245,000, payable in April 2005, an award of options to purchase 75,000 shares of the company’s common stock, which shall vest annually over three years in equal installments, an award of 100,000 restricted stock units, which shall vest in four equal parts upon the 2nd, 3rd, 4th, and 5th anniversaries, and an award of 100,000 shares of restricted stock, which shall vest after five years, each in accordance with the Visteon Corporation 2004 Incentive Plan. Mr. Palmer is also entitled to participate in the company’s annual incentive cash bonus program, with a guaranteed payment for fiscal 2004 of 35% of his annual base salary, and long-term incentive program, each as administered under the 2004 Incentive Plan, and he will generally receive health and welfare and other benefits consistent with the position. The memorandum also provides that Mr. Palmer will be entitled to a severance payment of at least twelve months of his base salary if his employment with the company is terminated without cause prior to the first anniversary of his hire date. The memorandum also provides that Mr. Palmer will be credited with two years of service for every year of actual service with Visteon under the SERP.

      Agreement with Dr. Pfannschmidt. A wholly owned subsidiary of the company has entered into a service agreement with Dr. Heinz Pfannschmidt that provides terms of his appointment, compensation, incentive plan compensation, benefits and perquisites, employment termination, non-competition and confidentiality. Dr. Pfannschmidt’s agreement is subject to termination by either party upon at least 24 months notice. The company provided written notice of termination of the agreement on March 20, 2006. Dr. Pfannschmidt is entitled to amounts that would have otherwise been payable under the agreement over the 24 month period following notice of termination, either in a lump sum or in installments.

      Agreement with Mr. Quigley. The company entered into an “at will” employment memorandum dated as of December 7, 2004 with Mr. Quigley. The memorandum provides for his employment as Vice President, Corporate Controller and Chief Accounting Officer. The memorandum provides that Mr. Quigley will receive an initial annual base salary of $350,000, a sign-on bonus of $350,000, payable in installments, 200,000 stock options and 25,000 restricted stock units, which shall vest after three years, each in accordance with the 2004 Incentive Plan. Mr. Quigley is also entitled to participate in the company’s annual incentive cash bonus program, with a guaranteed payment of $210,000 for 2005, and long-term incentive program, each as administered under the 2004 Incentive Plan, and he will generally receive health and welfare and other benefits consistent with the position. The memorandum also provides that Mr. Quigley will be entitled to a severance payment of at least twelve months of his base salary if his employment with the company is terminated without cause prior to the first anniversary of his hire date, and a severance payment of at least twelve months of his base salary plus $175,000 if his employment with the company is terminated without cause prior to the third anniversary, but after the first anniversary, of his hire date.

Change in Control and Separation Arrangements

      Change in Control Agreements. The company has entered into Change in Control agreements with each of Messrs. Johnston, Stebbins, Palmer and Quigley, as well as certain other officers, that specify two triggering events: (i) a change in control and (ii) within three years (executive officers) or two years (certain other officers) after the change in control one of the following events occurs: participant’s employment is terminated without cause; a negative material change in made in participant’s duties and responsibilities; participant’s compensation or benefits are decreased and such decrease is unrelated to company performance; participant is required to materially relocate his or her residence or principal office location against his or her will; or the participant is not offered a comparable position with the successor entity. Each of the executive officers and certain other officers also has 30 days at the end of the first year after a change in control to terminate his or her employment for any reason and still receive the benefits under the agreement.

      Each participant is entitled to the following benefits upon occurrence of the triggering events: base salary, pro-rated annual bonus and any accrued vacation pay through date of termination; a severance payment in the amount of three times (executive officers) or one and one-half times (certain other officers) base salary plus target bonus; all unvested options and restricted stock will vest and become immediately exercisable, all awards under the Visteon Corporation 2004 Incentive Plan become payable immediately on a pro-rated basis; any compensation previously deferred, together with accrued interest or earnings, will be distributed as a lump sum payout; participant’s SERP benefits will be funded through a trust or other mechanism which is protected from the persons controlling the company after the occurrence of the change in control; and health, dental and life insurance will remain in force over the cash severance benefit period. Change in control payments for executive officers will be grossed up for the payment, if any, of additional federal taxes (Code Section 280(G) “Excess Parachute Payment”). Other officers will not be grossed up; however, any officer whose contractual entitlements would be greater if such entitlements were to reduce the officer’s safe harbor level under the golden parachute excise tax provisions of the Code (thereby avoiding the imposition of the excise tax), will have his or her payment so reduced. An officer in this group whose contractual entitlements after payment of applicable excise taxes would be greater than his or her safe harbor amount would not incur such a reduction.

      Executive Severance Plan. In 2005, the company adopted the Visteon Executive Severance Plan (the “Severance Plan”). The Severance Plan provides for severance benefits to certain officers elected by the Board of Directors and senior management employees of the company whose employment is subsequently involuntarily terminated, subject to certain exceptions. These severance benefits include a cash payment equal to one year of base salary, the reimbursement of medical coverage premiums under COBRA for one year following termination, the payment of the unexpended value of his or her flexible perquisites account, the provision of outplacement services for up to six months, the pro ration of restricted stock and restricted stock unit awards granted more than 180 days prior to date of termination, and the continued exercisability of vested stock options for up to one year following termination. If the eligible executive does not execute an acceptable release and waiver of claims, such executive will be entitled to the foregoing severance benefits except that the cash payment will be reduced to an amount equal to four weeks of base salary, and such executive will not receive the remaining value of his or her flexible perquisites account nor be entitled to outplacement services.

      Agreements with Ms. Fox. On March 10, 2005, the company entered into a Resignation Agreement (the “Resignation Agreement”) and Consulting Agreement (the “Consulting Agreement”) with Ms. Fox. The Resignation Agreement provided for the terms of Ms. Fox’s resignation from regular employment with Visteon and its affiliates effective as of March 31, 2005. Pursuant to the Resignation Agreement, the company paid Ms. Fox a severance payment of $1.36 million and accelerated the vesting date relating to 43,000 shares of restricted stock previously awarded to Ms. Fox under the 2004 Incentive Plan. The foregoing payment and acceleration are in lieu of any other incentive compensation amounts or bonus previously awarded to Ms. Fox that had not been paid. Ms. Fox also agreed to release any claims she may have against the company or its affiliates and agents, continue to maintain the confidentiality of the company’s information and refrain from soliciting or hiring employees of Visteon or its subsidiaries.

      Pursuant to the Consulting Agreement, Ms. Fox agreed to provide consulting services and other assistance as may be required or requested by the company’s executives, attorneys and/or other representatives, up to a maximum of 160 hours per month. Ms. Fox received a retainer of $40,000 per month for a total of 7 months, as well as reimbursement for travel and business expenses reasonably incurred. The agreement was terminated on October 31, 2005.

ORGANIZATION AND COMPENSATION COMMITTEE REPORT

WITH RESPECT TO EXECUTIVE COMPENSATION REPORTED

FOR THE LAST COMPLETED FISCAL YEAR

      The Organization and Compensation Committee of the Board of Directors oversees the company’s programs for compensating executive officers and other key management employees, including the administration of the company’s equity-based compensation plans, and approves the salaries and other incentive awards to executive officers. During 2005, the Committee held eight meetings. As described above, the Committee operates under a written charter and is composed entirely of independent directors (consistent with the listing standards of the New York Stock Exchange).

Compensation Policies and Objectives

      The Committee believes that Visteon’s executive compensation program supports the company’s strategic objectives and provides strong alignment of the interests of its executives with these objectives as well as the creation of stockholder value. Visteon’s executive compensation programs are designed to accomplish the following key goals.

Components of Executive Officer Compensation for Fiscal 2005

      In 2005, the executive officers’ compensation was composed of a base salary, an annual incentive bonus opportunity, long-term incentive bonus and equity award opportunities, certain retention awards, and other employee benefits and perquisites. Visteon’s compensation program is generally targeted to deliver compensation at the median of the competitive market when performance is at expected levels, or on exception to attract and retain key executives. In 2005, the Committee reviewed comprehensive tally sheets and other information for all executive officers. The tally sheets and other information reviewed included all compensable pay and benefit programs normally included in our proxy statement, as well as healthcare, retirement, severance, perquisites, aircraft usage, change in control payments and stock ownership guidelines. The Committee believes that the aggregate compensation and benefits for the company’s executive officers for 2005 was appropriate and based on market competitive practices at the times such programs were implemented.

      In late 2005, the company conducted a global compensation study to analyze certain officer and non-officer level positions, to determine appropriate incentive opportunities in keeping with the company’s smaller size. Incentive compensation changes reflecting the results of this study are being implemented for 2006.

      For each executive officer, base salary compensation was reviewed in relation to job responsibilities, skills, experience, peer relationships and competitive industry practice. The competitive compensation assessment was based on executive positions in other comparably sized auto supply, technology and general industry companies. The company uses several executive compensation surveys, conducted by leading independent consulting firms. These compensation surveys include many of the companies in the Peer Group Index (see “Stock Performance Graph” on page 28), subject to their participation. In 2005, the base salaries of several executives were increased on the basis of these surveys and other factors.

      The annual incentive award for fiscal 2005 consisted of a performance-based cash bonus opportunity. The measures for determining annual incentive awards were profit before taxes and free cash flow. Individual awards can be modified up or down by specified individual goals in the areas of business results, leadership behavior and development of people. However, for fiscal 2005, the company did not meet the threshold performance requirements necessary for annual incentive awards to be paid, and consequently no such awards were paid.

      During 2005, the company made awards relating to the 2005-2007 performance period of stock options, restricted stock units, and performance-based and time-based cash opportunity awards. These stock options vest ratably over a three-year period. The restricted stock units will be paid in cash upon vesting after three years based on the fair market value of Visteon’s common stock as of such vesting date in 2008. Holders of restricted stock units receive dividend equivalents in cash; however, no dividends were paid in 2005.

      Fifty percent of the total 2005-2007 cash bonus opportunity can be earned upon the achievement by the company in 2007 of specified metrics for return on assets, weighted at 50% of this opportunity, and product quality rating metrics, weighted at 50% of this opportunity. The remaining fifty percent of the 2005 — 2007 cash bonus opportunity was designed to retain eligible employees and is dependent solely on the employee remaining with Visteon as of the end of each fiscal year of the performance cycle. Cash payments will be paid in one-third increments in each of 2006, 2007 and 2008.

      For the 2003-2005 performance period, the long-term incentive awards included a performance-based cash bonus opportunity, stock options and time-based restricted stock awards. In February 2006, the company paid approximately 25% of a participant’s total performance-based cash award opportunity based on the achievement of a J. D. Powers product quality metric for 2005; the remainder of the performance-based cash award was not paid because the company did not achieve the minimum return on assets metric for 2005. In addition, restrictions on shares of restricted stock issued in 2003 as a part of the 2003-2005 long-term incentive program lapsed as of February 10, 2006.

      Executive officers participate in the company’s retirement and savings and health and welfare plans on the same basis as other similarly situated employees, except for the supplemental pension and savings arrangements described below under “Executive Compensation — Retirement Benefits.” In addition, executive officers receive a monthly cash car allowance and a flexible perquisite account that may be used for certain discretionary purposes as well as other perquisites from time to time approved by the Committee. The company maintains an Executive Security Program that requires the Chief Executive Officer and the Chief Operating Officer to use the corporate-owned aircraft for personal and business travel, and provides the benefit of various personal health and safety protections.

Chairman and Chief Executive Officer Compensation for Fiscal 2005

      Mr. Johnston’s, the company’s Chairman and Chief Executive Officer, base salary for 2005 was $1.05 million, the same annual rate he received in 2004. At Mr. Johnston’s request the Committee did not review his base salary for 2005. As discussed above, Mr. Johnston did not receive a cash bonus payment under the 2005 annual incentive program (with a target payment of $1,207,500), but received a cash payment of $481,250 for the fiscal 2005 portion of the time-based retention cash component of the 2005-2007 long-term incentive program. Mr. Johnston also received a cash bonus payment of $544,950 pursuant to the 2003-2005 long-term incentive program discussed above, out of a target opportunity of $2,100,000. Also, pursuant to the 2005-2007 long-term incentive program, the Chief Executive Officer received a stock option grant of 656,548 shares, a restricted stock unit award of 231,185 units, a target performance cash bonus award opportunity of $1,443,750, and a time-based retention cash award opportunity of $1,443,750, ($481,250 of which was paid as described above). Finally, in 2005, after consultation with Towers Perrin, Mr. Johnston received a special transaction award of 100,000 stock appreciation rights, which vest in 50% increments in 2006 and 2007, and 200,000 restricted stock units, which vest in full in 2007, as recognition of his significant accomplishments in facilitating the strategic and structural transactions with Ford Motor Company that position the company for future viability.

Stock Ownership Requirements

      The company has adopted stock ownership goals for officers at the vice president level and above. The goal for these officers is to own common stock worth a multiple of salary, ranging from one times salary up to five times salary for the Chairman and Chief Executive Officer, within five years from adoption or their hire date, if later. All of the Named Executives employed by the company for five years or more are in compliance with the stock ownership guidelines.

Tax Deductibility of Compensation

      The Committee has also considered the company’s ability to deduct from taxable income certain performance based compensation under section 162(m) of the Code. The Committee generally intends that all compensation paid by the company be deductible, which includes awards earned or granted under the Incentive Plan. The Committee, however, reserves the right to pay nondeductible compensation if, in its sole discretion, it deems it necessary or desirable. For the company’s top five Named Executives, salaries in excess of $1 million and non-performance-based restricted stock or restricted stock units will not be exempt from section 162(m) of the Code.

Conclusion

      During 2005, the company experienced major change while engaged in its restructuring, and experienced higher than normal attrition during a period of uncertainty. The company’s target is to deliver compensation at the market median and believes this should enable Visteon to retain talent when financial and operational goals are achieved. Looking forward, the committee believes the compensation programs in place will allow the company to attract and retain key talent and reward employees for achieving the company’s financial and operational goals.

STOCK PERFORMANCE GRAPH

      The following graph compares the cumulative total return on the company’s common stock over a five year period with the cumulative total return on the S & P 500 Composite Index and a Peer Group Index that Visteon has developed. The Peer Group Index is composed of ArvinMeritor, Inc., American Axle & Manufacturing Holdings, Inc., Borg-Warner Automotive, Inc., Dana Corporation, Johnson Controls, Inc., Lear Corporation and Magna International, Inc. Delphi Corporation has been removed from the peer group index presented by the company previously as it ceased to be a publicly traded company. At this time, no company has been determined to be a suitable replacement of the removed company.

      The graph assumes an initial investment of $100 and reinvestment of cash dividends. The comparisons in this table are required by the Securities and Exchange Commission and are not intended to forecast or be indicative of possible future performance of the common stock or the referenced indices.

Comparison of Five-Year Cumulative Total Return

AUDIT COMMITTEE REPORT

      The Audit Committee operates under a written charter adopted by the Board of Directors. Visteon management has the primary responsibility for the company’s internal controls and the financial reporting process. The independent auditors are responsible for performing an independent audit of the company’s consolidated financial statements and issuing an opinion on the conformity of those audited financial statements with accounting principles generally accepted in the United States of America, and for auditing management’s assessment of Visteon’s internal control over financial reporting. The independent auditors also express an opinion, based on an audit, on the effectiveness of Visteon’s internal control over financial reporting. The Audit Committee oversees and monitors these processes and reports to the Board of Directors on its findings. During 2005, the Audit Committee held twenty-one meetings.

Auditor Independence

      During the year, the Audit Committee met and held discussions with Visteon management and PricewaterhouseCoopers LLP. The Audit Committee reviewed and discussed with Visteon management and PricewaterhouseCoopers LLP the audited financial statements contained in the company’s Annual Report on Form 10-K for the year ended December 31, 2005, as well as the company’s internal control over financial reporting. The Audit Committee also discussed with PricewaterhouseCoopers LLP the matters required to be discussed under the Statement on Auditing Standards No. 61 (Communications with Audit Committees).

      PricewaterhouseCoopers LLP submitted to the Audit Committee the written disclosures and the letter required by Independence Standards Board Standard No. 1 (Independence Discussions with audit Committees). The Audit Committee discussed with PricewaterhouseCoopers LLP the firm’s independence and considered whether the provision of non-audit services by PricewaterhouseCoopers LLP to the company is compatible with maintaining the independence of PricewaterhouseCoopers LLP. The Audit Committee concluded that the independence of PricewaterhouseCoopers LLP from Visteon and management is not compromised by the provision of such non-audit services.

      Based on these reviews and discussion, the Audit Committee recommended to the Board of Directors that the audited financial statements be included in the company’s Annual Report on Form 10-K for the year ended December 31, 2005, and filed with the SEC.

      The Audit Committee Report does not constitute soliciting material, and shall not be deemed to be filed or incorporated by reference into any other Visteon filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that Visteon specifically incorporates this Audit Committee Report by reference into any such filing.

Audit Fees

      The Audit Committee selects, subject to shareholder ratification, our independent auditors for each fiscal year. During the year ended December 31, 2005, PricewaterhouseCoopers LLP was employed principally to perform the annual audit of the company’s consolidated financial statements and internal control over financial reporting (including management’s assessment) and to provide other services. Fees paid to PricewaterhouseCoopers LLP for each of the past two years are listed in the following table:

      Audit services fees include fees for services performed to comply with Sarbanes-Oxley Section 404 and Generally Accepted Auditing Standards (“GAAS”) as adopted by the Public Company Accounting Oversight Board and approved by the SEC, including the recurring audit of the company’s consolidated financial statements. This category also includes fees for audits provided in connection with statutory filings or services that generally only the principal auditor reasonably can provide to a client, such as procedures related to the audit of income tax provisions and related reserves, and consents, assistance, and review of documents filed with the SEC.

      Audit-related fees include fees associated with assurance and related services that are reasonably related to the performance of the audit or review of the company’s financial statements. This category includes fees related to assistance in financial due diligence related to mergers and acquisitions, consultations regarding Generally Accepted Accounting Principles (“GAAP”), reviews and evaluations of the impact of new regulatory pronouncements, special studies related to deferred taxes, and audit services performed related to benefit/pension plans.

      Tax fees primarily include fees associated with tax compliance, as well as domestic and international tax planning. This category also includes fees for services rendered related to comprehensive tax compliance and planning for international service employees.

      All other fees pertain to administrative services for international service employees.

Audit Committee Pre-Approval Process and Policies

      The Audit Committee has adopted procedures for pre-approving all audit and non-audit services provided by the independent auditor. These procedures include reviewing and approving a budget for audit and permitted non-audit services by category. The Audit Committee specifically approves, in advance, each audit service relating to Visteon’s consolidated financial statements and internal control over financial reporting. Audit Committee pre-approval is also required to engage the independent auditor for any additional service that is not included in the approved budget. The Audit Committee considers whether such services are consistent with the SEC’s rules on auditor independence. The Audit Committee also considers whether the independent auditor is best positioned to provide the most effective and efficient service, for reasons such as its familiarity with the company’s business, people, culture, accounting systems, risk profile, and whether the services enhance the company’s ability to manage or control risks and improve audit quality. The Audit Committee may delegate pre-approval authority to one or more members of the Audit Committee. Lastly, the Audit Committee periodically monitors the services rendered and actual fees paid and commitments to be paid to the independent auditors.

ITEM 2. APPROVAL OF INDEPENDENT AUDITORS

      The next proposal on the agenda for the Annual Meeting will be ratifying the appointment of PricewaterhouseCoopers LLP by the Audit Committee as the company’s independent auditors for fiscal year 2006.

      PricewaterhouseCoopers LLP served in this capacity for fiscal year 2005, and has reported on the company’s 2005 consolidated financial statements.

      Representatives of PricewaterhouseCoopers LLP, the company’s independent auditors, are expected to be present at the Annual Meeting. They will have the opportunity to make a statement at the meeting if they desire to do so and are expected to be available to respond to appropriate questions. For information regarding fees paid to PricewaterhouseCoopers LLP, see “Audit Fees” on page 30.

      The Board of Directors Recommends that You Vote for the Ratification of PricewaterhouseCoopers LLP as the Company’s Independent Auditors for Fiscal Year 2006.

ITEM 3. APPROVAL OF AMENDMENTS TO VISTEON CORPORATION

2004 INCENTIVE PLAN

      The next proposal on the agenda for the Annual Meeting will be to approve amendments to the Visteon Corporation 2004 Incentive Plan (the “Incentive Plan”). The Incentive Plan was originally adopted effective as of June 28, 2000 as the 2000 Incentive Plan, and approved by stockholders on May 9, 2001. The Incentive Plan was amended and restated on March 16, 2004, and approved by stockholders on May 12, 2004. The Board of Directors, following the approval and recommendation of the Organization and Compensation Committee, adopted the proposed amendments to the Incentive Plan on March 16, 2006, subject to stockholder approval at the Annual Meeting.

      The amendments to the Incentive Plan include the following changes from the existing plan:

      As of December 31, 2005, without taking into account any increase in the number of shares available under the Incentive Plan, there were approximately 859,881 shares not subject to outstanding awards under the Incentive Plan. Subject to the overall plan limit, approximately 100,000 shares would be available for awards of stock rights, restricted stock, restricted stock units (only to the extent that each such restricted stock unit may be settled by the delivery of common stock) and other stock-based awards pursuant to the Incentive Plan, as amended.

      Our Organization and Compensation Committee believes that increasing the total number of shares available for awards under the plan is necessary to ensure that a sufficient number of shares will be available to fund our employee compensation programs over the next two to three years. Our Organization and Compensation Committee believes that making a significant portion of the compensation of certain employees, whose efforts can affect the value of Visteon depend upon the long-term performance of our common stock, encourages those employees to work in a way that maximizes stockholder value. The Incentive Plan is also designed to help retain and attract key employees and consultants.

      To facilitate approval of this proposal and address any shareholder concerns regarding the number of options and/or shares the company intends to grant in any given year, the company commits to its shareholders that the number of shares (including those subject to options) to be awarded under the Incentive Plan for 2006-2008 will not exceed, on average, 3.2% of the total number of shares outstanding for each fiscal year. For purposes of calculating the number of shares awarded in a year, restricted stock, stock units or other awards that will be settled in stock will count as the equivalent of 1.5 shares.

Summary of the Incentive Plan

      The following is only a summary of the Incentive Plan, as proposed to be amended, and is qualified in its entirety by reference to its full text, a copy of which is attached as Appendix C to this proxy statement.

      The Incentive Plan is administered by the Organization and Compensation Committee of the Board of Directors. The Incentive Plan provides for the payment of performance cash awards and the grant of incentive and nonqualified stock options, stock appreciation rights, performance stock rights (“stock rights”), restricted stock, restricted stock units and various other rights based on stock (individually, an “award” or collectively, “awards”). Salaried employees, as well as certain non-employees, of Visteon with potential to contribute to the future success of Visteon or its subsidiaries will be eligible to receive awards under the Incentive Plan. The Organization and Compensation Committee has the discretion to select the employees to whom awards will be granted, to determine the type, size and terms and conditions applicable to each award and the authority to interpret, construe and implement the provisions of the Incentive Plan. The Organization and Compensation Committee’s decisions will be binding. The Organization and Compensation Committee also may delegate to a committee of Visteon officers the selection of eligible employees and the determination of the amount of individual awards for employees and certain non-employees who are not executive officers of Visteon, within limitations prescribed by the Organization and Compensation Committee.

      The total number of shares of our common stock that may be subject to awards under the Incentive Plan, referred to as the “overall limit,” is 21,800,000, subject to adjustment as provided in the Incentive Plan. For calendar years after 2003, no more than 1,000,000 shares of our common stock may be subject to stock options (with or without any related stock appreciation rights) or to stand-alone stock appreciation rights awarded to any “covered employee,” which generally means our chief executive officer and the next four most highly paid executive officers, in any one calendar year. Common stock issued under the Incentive Plan may be either authorized but unissued shares (subject to a maximum limit of 2,000,000 shares), treasury shares or any combination thereof. For calendar years after 2003, no more than 1,000,000 shares of common stock may be available as awards pursuant to performance-based stock rights, restricted stock and restricted stock units granted under the Incentive Plan to any covered employee in any one calendar year, and no more than 3,662,332 shares in total may be issued pursuant to stock rights, restricted stock, restricted stock units (only to the extent that each such restricted stock unit may be settled by the delivery of common stock) and other stock-based awards. Any shares of common stock subject to an award that lapses, expires or is otherwise terminated without the issuance of such shares may become available for future awards.

      Options to purchase shares of our common stock, which may be incentive or nonqualified stock options, may be granted under our Incentive Plan at an exercise price (the “option price”) at least equal to the average of the highest and lowest prices at which Visteon common stock was traded on the New York Stock Exchange on the date of grant. Each option represents the right to purchase one share of common stock at the specified option price.

      Options granted after December 31, 2005 will expire not later than seven years after the date on which they are granted. Options granted after December 31, 2003 and on or prior to December 31, 2005 will expire not later than five years after the date on which they are granted. Options granted on or prior to December 31, 2003 will expire not later than 10 years after the date on which they are granted. Options become exercisable at such times and in such installments as determined by the Organization and Compensation Committee. Payment of the option price can either be made in full at the time of exercise by check or wire transfer, or, if the Organization and Compensation Committee so determines and the participant so elects, in installments. Unless the Organization and Compensation Committee determines otherwise, payment in full or in part may also be made by tendering to Visteon shares of our common stock (if owned at least six months) having a fair market value equal to the option price (or such portion thereof).

      An award of a stock appreciation right may be granted under the Incentive Plan. Generally, one stock appreciation right is granted with respect to one share of our common stock. The stock appreciation right entitles the participant, upon the exercise of the stock appreciation right, to receive an amount equal to the appreciation in the underlying share of common stock. The appreciation is equal to the difference between (1) the “base value” of the stock appreciation right (i.e., the option price on the date the stock appreciation right is granted), and (2) the average of the highest and lowest prices at which Visteon common stock was traded on the New York Stock Exchange on the date the stock appreciation right is exercised. Upon the exercise of a vested stock appreciation right, the exercising participant will be entitled to receive the appreciation in the value of one share of common stock as so determined, payable at the discretion of the Organization and Compensation Committee in cash, shares of common stock, or some combination thereof, subject to the availability of our shares of common stock.

      Stock appreciation rights granted after December 31, 2005 will expire not later than seven years after the date on which they are granted. Stock appreciation rights granted after December 31, 2003 and on or prior to December 31, 2005 will expire not later than five years after the date on which they are granted. Stock appreciation rights granted on or prior to December 31, 2003 will expire not later than 10 years after the date on which they are granted. Stock appreciation rights become exercisable at such times and in such installments as determined by the Organization and Compensation Committee.

      An option and a stock appreciation right may be granted “in tandem” with each other. An option and a stock appreciation right are considered to be in tandem with each other because the exercise of the option aspect of the tandem unit automatically cancels the right to exercise the stock appreciation right aspect of the tandem unit, and vice versa. The option may be an incentive stock option or a nonqualified stock option, as determined by the Organization and Compensation Committee. Descriptions of the terms of the option and the stock appreciation right aspects of a tandem option/stock appreciation right are provided above.

      Awards granted under the Incentive Plan may result in federal income tax consequences to Incentive Plan participants and Visteon. Some of those federal income tax consequences with respect to options are generally set forth in the following summary.

      An employee who is granted an incentive stock option that qualifies under Section 422 of the Code will not recognize income at the time of grant or exercise of such option. Visteon will not be entitled to a federal income tax deduction upon the grant or exercise of an incentive stock option. However, upon the exercise of an incentive stock option, any excess in the fair market price of the common stock over the option price constitutes a tax preference item that may have alternative minimum tax consequences for the employee. When the employee sells the shares more than one year after the date of transfer of the shares and more than two years after the date of grant of the incentive stock option, the employee will normally recognize a long-term capital gain or loss equal to the difference, if any, between the sales price of the shares and the aggregate option price. In such event, Visteon will not be entitled to a federal income tax deduction with respect to the exercise of the incentive stock option or the sale of the shares. If the employee does not hold the shares for the required period, when the employee sells the shares, the employee will recognize ordinary compensation income and possibly capital gains or losses in such amounts as are prescribed by the Code and Visteon will generally be entitled to a federal income tax deduction in the amount of such ordinary compensation income.

      An employee who is granted a nonqualified stock option will not recognize income at the time of grant of the option. In general, when the employee exercises a nonqualified stock option, the employee will recognize ordinary compensation income equal to the difference, if any, between the option price paid and the fair market value, as of the date of option exercise, of the shares of common stock the employee receives. The tax basis of the shares to the employee will be equal to the option price paid, plus the amount includible in the employee’s gross income, and the employee’s holding period for such shares will commence on the date of exercise. Subject to the Code, Visteon will generally be entitled to a federal income tax deduction in respect of a nonqualified stock option in an amount equal to the ordinary compensation income recognized by the employee upon the exercise of the nonqualified stock option.

      Subject to the limits discussed above, the Organization and Compensation Committee may authorize the award of restricted stock and restricted stock units to employees under the Incentive Plan. Restricted stock awards are issuances of our common stock to employees that are subject to restrictions on transfer and forfeiture if one or more specified performance goals or minimum periods of service are not attained. Restricted stock units may also be awarded in lieu of, or in addition to, restricted stock awards and consist of a unit credited to a hypothetical account, valued based on the fair market value of our common stock, and subject to forfeiture if one or more specified performance goals or minimum periods of service are not attained. Prior to the expiration of the restriction period, a grantee that has received a restricted stock award generally has the rights of a stockholder of Visteon, including the right to vote and to receive cash dividends on the shares subject to the award. If the Organization and Compensation Committee so determines, the holder of a restricted stock unit may receive cash payments equivalent in value to dividends paid on our common stock, either at the time the dividends are otherwise payable or upon the payment of the final award relating to such restricted stock unit. The Organization and Compensation Committee will determine in advance of each award the terms and conditions applicable to each award of restricted stock and restricted stock units, including the applicable performance criteria or minimum periods of service required, and whether awards of restricted stock units will be settled in cash or in shares of common stock, and may make certain adjustments to the performance criteria and the amount of final awards.

      Subject to the limits discussed above, the Organization and Compensation Committee may authorize the award of performance stock rights to employees under the Incentive Plan. Performance stock rights represent the right to receive shares of our common stock if one or more specified performance goals are attained. If the Organization and Compensation Committee so determines, the holder of a performance stock right may receive cash payments equivalent in value to dividends paid on our common stock, either at the time the dividends are otherwise payable or upon the payment of the final award relating to such performance stock right. The Organization and Compensation Committee will determine in advance of each award the terms and conditions applicable to each award of performance stock right, including the applicable performance criteria, and whether awards of performance stock rights may be settled in cash or other stock equivalents, and may make certain adjustments to the performance criteria and the amount of final awards.

      The Organization and Compensation Committee also may grant other stock-based awards to such employees as it may select. These awards may include awards of restricted stock, stock units, “phantom stock” and options not otherwise specifically addressed above. The Organization and Compensation Committee may determine the time or times at which these awards will be made, the number of shares of common stock or stock units and the like to be granted or covered pursuant to such awards, including, whether such awards will be payable or paid in cash, common stock or otherwise, and whether the awards will be granted as a bonus for no consideration other than services rendered.

      The Organization and Compensation Committee may award or authorize performance cash awards to such employees as it may select, and in such amounts as it may designate, subject to the terms of the Incentive Plan. The Organization and Compensation Committee determines the performance period and performance criteria for a performance cash award. Within 90 days of the beginning of a performance period, the Organization and Compensation Committee decides the targeted performance level at which a target award may be earned. The Organization and Compensation Committee decides the target award based on the employee’s level of responsibility and other factors. The target award, designated as a percentage of base salary, is based on achieving 100% of the performance goals established by the Organization and Compensation Committee for the performance period. The Organization and Compensation Committee also decides any minimum performance level below which no cash award would be paid. The maximum amount that may be granted to a covered employee as a final award with respect to one or more performance cash awards during any calendar year is $10,000,000.

      As soon as practicable following the completion of the performance period, the Organization and Compensation Committee determines the extent to which the participant achieved the performance goals and the amount of compensation to be awarded as a final award by applying the applicable performance formula against the accomplishment of the related performance goals. The Organization and Compensation Committee may, in its sole discretion, reduce the amount of any final award to any participant or increase the amount of any final award to any participant who is not a covered employee. In making such adjustments, the Organization and Compensation Committee shall take into account the extent to which the performance goals were achieved, individual performance, and such other factors as the Organization and Compensation Committee may deem relevant, such as a change in circumstances or unforeseen events during the performance period.

      Under the Incentive Plan, in the event of a merger, consolidation, reorganization, stock split, stock dividend or other event affecting our common stock, such adjustments as may be necessary (as determined by the Organization and Compensation Committee) to reflect such change will be made to prevent dilution or enlargement of the rights with respect to the overall limit, the option limit, the annual and aggregate stock right limits, the number of shares of common stock covered by each outstanding award, any other references in the Incentive Plan to a number of shares and the price per share in respect thereof.

      Unless otherwise determined by the Organization and Compensation Committee, an individual’s rights under the Incentive Plan may not be assigned or transferred (except in the event of death). An individual’s rights under the Incentive Plan are subject to forfeiture for competitive activity or activity that is not in our best interest.

      All administrative expenses of the Incentive Plan will be paid for by the company and its participating subsidiaries.

      Unless terminated earlier by the Board of Directors, the Incentive Plan will terminate on May 11, 2014. The Board of Directors may at any time terminate, modify or amend the Incentive Plan; provided, however, that the Board may not, without the approval of the stockholders, (1) increase the overall limit, the option limit, the performance cash limit or the annual and aggregate limits applicable to stock rights, restricted stock, restricted stock units and other stock-based awards, (2) extend the term of the plan, (3) permit a member of the Organization and Compensation Committee to participate, or (4) decrease the grant price of any outstanding option or stock appreciation right.

      The Incentive Plan provides for acceleration of vesting and distribution of some plan awards in the event of a change of control of the company.

Other Information

      Since it is within the discretion of the Organization and Compensation Committee to determine which employees will receive grants under the Incentive Plan and the type and amount thereof, these matters cannot be specified at present. While nearly all of the approximately 17,000 salaried employees of Visteon and its subsidiaries are eligible under the literal terms of the Incentive Plan to receive grants under the plan, it is presently contemplated (and has been the Organization and Compensation Committee’s practice in the past) that grants of stock options and stock appreciation rights, and to a lesser extent if at all, grants of restricted stock and restricted stock units, would be made primarily to senior and middle managers, including the Named Executives, which currently includes approximately 300 employees. For stock option, stock appreciation rights and restricted stock unit grants as well as other benefits awarded to our Named Executives in 2005 under our Incentive Plan see “Executive Compensation” beginning on page 10.

      On March 15, 2006, the New York Stock Exchange reported a closing price of $4.53 for our common stock.

      The Board of Directors recommends that you vote FOR the approval of the amendments to the Visteon Corporation 2004 Incentive Plan.

ITEM 4. APPROVAL OF AMENDMENT TO THE

VISTEON CORPORATION NON-EMPLOYEE DIRECTOR STOCK UNIT PLAN

      The next proposal on the agenda for the Annual Meeting will be to approve an amendment to the Visteon Corporation Non-Employee Director Stock Unit Plan (the “Directors Plan”). The Directors Plan was originally adopted effective February 11, 2004, and approved by stockholders on May 12, 2004. The Board of Directors, following the approval and recommendation of the Corporate Governance and Nominating Committee of the Board of Directors, amended the Directors Plan on February 9, 2006, subject to stockholder approval at the Annual Meeting. The amendment to the Directors Plan increases the annual stock unit grant from $10,000 to $70,000.

      The Corporate Governance and Nominating Committee, which is responsible for establishing non-employee director compensation, reviewed trends and practices with respect to director compensation, including a study performed by an outside consultant, and determined that amending the Directors Plan is in the best interests of the company and its stockholders. By maintaining non-employee director compensation that is competitive with its peers, the company will be better able to retain and attract qualified directors. Also, we believe that awarding more of director compensation in stock units that must be held until service on the Board ends will further align the economic interests of the directors with long-term stockholders of the company. If the amendment to the Directors Plan is approved, the Board of Directors will cease new awards of restricted stock under the Visteon Corporation Restricted Stock Plan for Non-Employee Directors.

Summary of the Directors Plan

      The following is only a summary of the Directors Plan, as proposed to be amended, and is qualified in its entirety by reference to its full text, a copy of which is attached as Appendix D to this proxy statement.

      The Directors Plan is intended to be self-administering. However, an administrative committee composed of the non-participating members of the Board has the authority (i) to interpret and administer the Directors Plan; (ii) establish, amend, suspend or waive rules of regulations of the Directors Plan; and (iii) take any other action it deems necessary for administration of the Directors Plan. Also, the Organization and Compensation Committee has discretion to determine if distributions under the Directors Plan will be made in common stock or cash.

      All administrative expenses of the Directors Plan will be paid for by the company.

      Under the Directors Plan, a participant is defined as each member of the board who is not an officer or employee of the company or any of its subsidiaries and who has a book-entry account under the plan. There are currently seven eligible participants under the Directors Plan, and each participant will receive an award as of the day after the Annual Meeting.

      Under the Directors Plan, as of the day immediately after the date of the company’s annual stockholders meetings, each participant will have credited to a book-entry account of the company a number of Visteon stock units equal to the result obtained by dividing (A) $70,000 by (B) the average of the high and low prices of a share of our common stock sold on the New York Stock Exchange on such date.

      Each month each participant will have credited to a book-entry account of the company a number of Visteon stock units determined by dividing the participant’s deemed dividends for such month by the average of the high and low prices a share of our common stock sold on the New York Stock Exchange on the last trading day of such month.

      Each participant remains 100% vested in all amounts credited to his or her account under the Directors Plan. Distributions of amounts in a participant’s account will be made either in a single sum or ten annual installments, at the advance election of the participant, commencing upon the later of (1) January 15th of the calendar year following the calendar year in which the participant terminates service as a non-employee director of the company, or (2) the first business day of the seventh month following the month in which the participant terminates service as a director of the company.

      The Directors Plan will terminate on May 12, 2014, unless terminated earlier by the Board of Directors. No amendment or termination of the Directors Plan will adversely affect the rights of any participant or beneficiary to benefits then accrued without the written consent of the affected participant or beneficiary.

      The Board of Directors recommends that you vote FOR the approval of the amendment to the Visteon Corporation Non-Employee Director Stock Unit Plan.

ITEM 5. SHAREHOLDER PROPOSAL RELATING TO

ANNUAL ELECTION OF DIRECTORS

      The next proposal on the agenda for the Annual Meeting will be a shareholder proposal relating to the annual election of directors. In accordance with SEC rules, the text of the shareholder proposal is printed exactly as it was submitted. John Chevedden, 2215 Nelson Avenue, Redondo Beach, California 90278, has informed the company that he intends to present for consideration at the Annual Meeting the following proposal on behalf of Mr. Leeds, and has furnished the following statement in support of the proposal:

5 — Elect Each Director Annually

RESOLVED: Shareholders request that our Directors take the necessary steps, in the most expeditious manner possible, to adopt annual election of each director. This includes complete transition from the current staggered system to 100% annual election of each director in one election cycle if practicable. Also to transition solely through direct action of our board if practicable.

Jack Leeds, 44930 Dunbarton Drive, Novi, MI 48375 submitted this proposal.

Thirty-three (33) shareholder proposals on this topic won an impressive 66% average yes-vote in 2005 through late-September. The Council of Institutional Investors www.cii.org, whose members have $3 trillion invested, recommends adoption of this proposal topic.