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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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To: ild who wrote (74698)12/1/2006 1:48:46 PM
From: ild  Read Replies (2) of 110189
=DJ 3rd UPDATE: Ford Nov Sales Dn 9.6%, Behind Toyota

Dow Jones News Services
(Copyright © 2006 Dow Jones & Company, Inc.)

(Updates throughout, adds detail on model performance, moves up detail on fourth-quarter production cut.)

By Judy Lam and Terry Kosdrosky

DETROIT (Dow Jones)--Ford Motor Co. (F) said its sales of cars and light trucks in the U.S. dropped 9.6% in November, hurt by a sharp decline in truck sales and lower fleet sales as the auto maker was surpassed by Toyota Motor Co. (TM) in monthly sales for the second time this year.

The No. 2 U.S. auto maker also cut its fourth-quarter North American production forecast by an additional 15,000 vehicles to 620,000. That's on top of the 20% cut it already announced and reflects the temporary suspension of Freestar production at the Oakville plant in Ontario, Canada, Ford said in a release.

Ford also said it will cut first-quarter 2007 production by 14.4% to 750,000 vehicles, which is the high end of its prior estimate of a first half production cut of 8%-12%.

Ford said it sold 182,259 cars and light trucks in November, compared with 201,711 a year ago. That ended two straight months of sales increases. The Dearborn, Mich., company's passenger car sales fell 2.6%, while truck and SUV sales - representing Ford's most profitable business - were down 12.9%.

The monthly decline included Ford's flagship F-Series pickup trucks, which slipped 16% in November. Explorer SUV sales were down 10%. But sales of Ford's redesigned full-size SUVs, the Ford Expedition and Lincoln Navigator were up 14% and 65%, respectively.

There were 25 selling days last month, same as the 2005 period.

Ford's results are lower than many analysts had forecasted, as Ford was expected to post flat sales or a small gain compared with last November. The decline opened the door for Toyota, which has been stealing market share from U.S. rivals, to surge ahead in the month with U.S. sales of 196,695 vehicles, an increase of 15.9% from last year. In July, Toyota surpassed Ford in monthly sales for the first time ever.

On the car side, sales of Ford's mid-size sedans, the Ford Fusion, Mercury Milan and Lincoln MKZ were up 66%, 29% and 83%, respectively. The sedans were still relatively new a year ago. The Ford Five Hundred sedan was off 53.9% and the Taurus, which is ending production and was a big seller to fleet customers, was down 30.9%.

In a press release, Ford said its inventory level sat at 631,000 vehicles at the end of November, 122,000 lower than a year ago. The company estimates 85% of the inventory is new 2007 models.

Earlier Friday, Chrysler, the U.S. unit of DaimlerChrysler AG (DCX), posted a 2.9% increase in sales last month. The company will release a breakdown of its Chrysler sales later in the day.

General Motors Corp. (GM) will also report its November sales data in the afternoon, and analysts are expecting the world's largest auto maker to report better sales from last year.

Ford, which has been struggling with falling U.S. market share and high labor costs, announced plans to borrow $18 billion to help fund its restructuring and said its employee-buyout yielded strong results earlier in the week. The auto maker, which is pledging nearly all its U.S. automotive and other assets as collateral, forecast a total cash outflow of $17 billion between 2007 and 2009.

Production at the Big Three were closely watched as executives attending the Los Angeles Auto Show this week said they expect 2007 to be a relatively flat year for U.S. auto industry sales, with some saying that the market could soften slightly amid a broader economic decline.

-By Judy Lam, Dow Jones Newswires; 201-938-5975

-By Terry Kosdrosky, Dow Jones Newswires; 313-226-1251;
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