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Wednesday, September 3, 2008

Ford sales plunge 27% in August

NEW YORK ( -- Falling gasoline prices were not enough to revive sales of SUVs and pickups in August as Ford Motor reported a sharp fall in sales once again, and warned that even tougher times are ahead for the rest of the year.

Ford (F, Fortune 500) reported U.S. auto sales fell 27% in the month compared to a year earlier -- far worse than the forecast of a 16% tumble in sales from auto sales tracker

Sales of Ford's pickup and van models tumbled 39% while sales of SUVs plunged 53%.

Even sales of cars, which are typically more fuel efficient than light trucks, fell 9% in August.

Year-to-date, sales at Ford have fallen 16%. And the automaker suggested that it doesn't see any signs of a quick turnaround.

"We expect the second half of 2008 will be more challenging than the first half, as weak economic conditions and the consumer credit crunch continues," said Jim Farley, group vice president of marketing and communications, in the sales report.

Ford trimmed its forecast for full-year industrywide sales in the U.S. to the low end of its previously announced range of 14 million to 14.5 million.

Auto experts are predicting that this will be the worst August for auto sales in 15 years. is forecasting a 14% drop in sales industrywide.

Sales are expected to be slightly higher than the dreadful results in July -- which was the weakest month based on seasonally-adjusted sales since 1992.

Gasoline prices declined throughout August, falling about 10% from the record $4.114 set on July 17. But continued job losses and home price declines, coupled with low consumer confidence, kept many potential car and light truck buyers on the sidelines.

In response to the weak sales and outlook, Ford announced Wednesday that it would cut second-half production plans by about 5%, trimming 20,000 vehicles in the third quarter and 30,000 vehicles in the fourth quarter

Other major automakers, including General Motors (GM, Fortune 500), Toyota (TM) and Chrysler LLC are also expected to report a drop in sales from year-earlier levels later Wednesday. Honda Motor (HMC) is forecast to benefit from a shift in buyers' preference for more fuel efficient vehicles by reporting a gain in sales