Tuesday, March 3, 2009

Ford's sales plunge 48%

Ford Motor reported Tuesday that sales fell 48% in February, kicking off a series of reports expected to show that last month was the worst yet for the auto industry during this recession.

Ford sold 96,044 cars and light trucks in the U.S. during the month, a bit better than the January sales total.

The weak demand was broadbased -- sales of virtually every model Ford had on the market a year ago fell more than 10%.

Sales forecaster Edmunds.com had estimated that Ford's sales would be down 50% from year-earlier levels, roughly in line with the declines expected at General Motors (GM, Fortune 500) and Chrysler LLC, which will report later in the day.

But Ford (F, Fortune 500) and its U.S. rivals aren't the only automakers expected to be hit by the current downturn.

Edmunds forecasts declines of more than 33% at Japanese automakers Toyota Motor (TM), Honda Motor (HMC) and Nissan (NSANY). Overall industrywide sales are forecast to fall at least 40% to a seasonally adjusted annual rate of between 9.1 million to 9.3 million.

That would be the worst sales rate since December 1981. The sales rate was 9.5 million in January.

"The economic and competitive environment remains challenging," said Ken Czubay, Ford's vice president of sales and marketing, in a statement.

Ford also announced it is cutting production in North America during the second quarter by 38% to keep supply in line with the reduced demand.

The lower outlook for industrywide sales has prompted GM and Chrysler, which have received $17.4 billion in federal loans between them, to ask for another $21.6 billion in federal assistance to see them through the downturn.

Ford, which went into the current crisis with a better cash position, has thus far not asked for federal loans. But it has requested a $9 billion line of credit in case sales don't improve soon.

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