A collapse in sales of its gas-guzzling sports utility vehicles has sent Ford deep into the red. The troubled car maker reported a loss of $1.2bn (£700m) for the first three months of the year, as it begins what it said would be a "painful" restructuring of its US business.
The company has written redundancy cheques for 4,700 employees since the start of the year, and is promising to shed 34,000 jobs and shut 14 North American factories over the next six years.
The worst news from yesterday's quarterly results was not the costs of the restructuring, however, but the state of the underlying business, which performed below Wall Street's expectations.
Sales of the hulking Ford Explorer, the company's top-selling SUV, plunged 25 per cent, while sales of the Expedition were down 29 per cent. And the company warned that soaring petrol prices would depress demand still further.
Ford makes more profit on these vehicles than it does on the smaller cars in its portfolio.
The Michigan-based company, in common with its rust-belt rival General Motors, has been losing market share to Asian manufacturers. On Thursday, GM posted a loss of $323m for the first quarter. Both companies are struggling under mountains of debt, which has been labelled "junk" by credit rating agencies.
Ford said it was launching 20 models in Europe and the US this year which would help it claw back some of its lost market share. And it said the cost-cutting programme was progressing well.
Bill Ford, the chief executive, said: "This transformation isn't going to be quick, and it isn't going to be painless."Reuse content