Ford CEO Alan Mulally is expected to announce total 2010 profits of $8 billion later this week.

Hoping to build its reputation with environmentally-minded motorists, Ford Motor Co. put a spotlight on battery power during this year’s Detroit Auto Show, unveiling models like the plug-in C-Max Energi microvan.  But later this week, Ford CEO Alan Mulally will focus on a different sort of green.

If all holds according to the expectations of Wall Street analysts, the maker is expected to announce that its profits for 2010 came to a total of $8 billion, the biggest number the maker has seen in a decade.  That figure is all the more significant since it came during one of the worst years the industry has experienced since the Great Depression, rather than at a time when U.S. car sales were running at or near record levels.

But there could be a downside to the big profit.  Ford, like its Detroit Three brethren, is getting ready to return to the bargaining table with the United Autoworkers Union.  The last time they hammered out a contract, in 2007, the union agreed to make major changes, and more followed during the downturn, including the creation of an employee-owned health program and the addition of a two-tier wage structure.

UAW leaders, including new President Bob King, have made it clear they expect to share in Ford’s bonanza.  The automaker, in turn, feels it will meet that expectation with profit sharing checks that could be the largest in years.  But will that be enough to satisfy workers – especially militants who are agitating to get back at least some of what they’ve given up in recent years?

During a meeting with TheDetroitBureau.com, late last year, CEO Mulally expressed both his appreciation of the UAW’s contributions, but also the need not to let costs get out of control again.

Indeed, with the UAW’s help, says David Cole, chairman-emeritus of the Center for Automotive Research, Ford and its cross-town rivals have been able to reduce what used to be a $3,000 to $4,000 disadvantage in terms of the cost of building a new car in UAW-organized plants and now have a similar cost advantage over “transplant” assembly lines operated by rivals such as Toyota, Honda and Nissan.

Mulally is continuing to move on Ford’s still-sizable debt, one of the biggest areas where he sees opportunities to further cut costs in North America.  Joining the maker in autumn 2006, the former Boeing executive agreed to a plan that generated a $23.5 cash line by mortgaging Ford’s facilities.  Even before the maker returned to the black Mulally started the process of paying down that debt.

In November, he announced steps to reduce the number by another $1.9 billion.  That will result in a one-time charge against fourth-quarter earnings of $960 million.  But the maker is expected to still generate $1.6 billion in profits for the October-December quarter, bringing the figure for the full year to $8 billion.

By comparison, the maker reported losses of $30 billion between 2006 and 2008, including a $17 billion deficit Mulally had to reveal just shortly after moving to the Dearborn maker.

Most of those losses were generated by Ford’s core North American operations – which remained in the red through 2009.  For the first three months of 2010, however, the home market generated 68% of Ford’s global profits, or $4.7 billion.

While Mulally said, during last year’s interview, that there are still plenty of challenges to be resolved in North America, Ford is focusing more of its attention on overseas units, from Europe to China.  Still struggling with excess capacity and major economic uncertainties, Europe is not recovering nearly as quickly as hoped for.  Meanwhile, China has proven to be a bit of a frustration for Ford’s senior management.

The company got off to a late start in the booming Asian nation – where car sales may top a worldwide, all-time record of 20 million this year.  (Click Here for more.) General Motors, which rushed in more than a decade ago, defying skeptics now proved wrong, is the market leader and the first maker to ever sell more than 2 million vehicles in China in a single year.  Ford is playing a game of catch-up there, though it is rapidly expanding its line-up and will be opening three new assembly plants with its joint venture partners.

Mulally’s apparent strategy is to now focus on the numerous second- and third-tier Chinese cities just beginning to share in the economic miracle that has transformed Pacific Coast markets, like Shanghai and Beijing.  But it remains to be seen if and when this will get Ford a significant – and profitable – stake in China.

There are other issues, of course.  After selling off its European luxury brands, such as Jaguar, reducing ties with Japan’s Mazda, and closing long-struggling Mercury, Mulally’s management team now needs to kick Lincoln into high gear, no easy task.

But the CEO also stressed that Ford is positioned to generate even more cash as it better implements its so-called One Ford strategy.  That plan focuses on uniting the maker’s global empire and developing new products, like the next-generation Focus, that can be marketed around the world with only modest localized changes.  It’s a key reason why Ford believes it can now turn a reasonable profit on models like Focus and the even-smaller Fiesta.

The wild card could be the UAW.  With rare exception, Ford and the union have long had solid relations, though strains showed through, in the wake of the General Motors and Chrysler bankruptcies, when workers declined to give Ford some of the same concessions they’d granted the two rivals during their Chapter 11 reorganizations.

A battle with the UAW in the months to come could be the devastating setback Mulally has hoped not to have to work into his plans.