Ford slips to No 4 as US Nov car sales slump

DETROIT, Dec 2 (Reuters) Ford Motor Co dropped from second to fourth in the US auto market in November as its sales slid by 10 percent, while Toyota Motor Corp.'s sales surged 16 percent to put it in the No 2 spot.

Overall, U.S. auto sales were weaker than expected, slipping to their lowest level since October 2005 and raising concern about whether the industry would face a slump next year rather than the flat market most automakers are projecting.

General Motors Corp. reported 6 percent sales growth in November, while DaimlerChrysler AG's Chrysler Group posted a 3 percent rise, breaking a nine-month losing streak, according to the sales data released on Friday.

''Ford was a major disappointment,'' said Global Insight analyst George Magliano. ''I think the economy is really starting to push hard against the market.'' Having sold fewer cars and light trucks in November than DaimlerChrysler overall, Ford slashed its planned production.

Nissan Motor Co.'s sales fell almost 2 percent and Hyundai Motor Co. Ltd.'s sales dropped almost 15 percent. Honda Motor Co. Ltd.'s sales rose about 1 percent.

Industry-wide sales ran at an annualized rate of 16.04 million units for November, short of most analysts' forecasts and relatively weak October sales, according to Autodata Corp.

Light-vehicle sales this year are expected to be near 17 million units and many auto executives have said they expect new model launches to offset the pressure from a weakening housing market on consumer demand.

Toyota, the world's No. 2 automaker by output, outsold Ford by more than 14,000 units in November to take the No. 2 U.S.

spot based on monthly sales for the second time this year.

Many analysts expect Toyota to keep that ranking on a more permanent basis in 2007 as Ford's market share slips further.

Ford's market share dropped from 16 percent a year earlier to 14 percent -- the bottom of the sales projection behind a cost-cutting program that prompted buyouts for 38,000 union workers, half of its factory workforce.

Toyota's market share jumped nearly 2 percentage points to just over 16 percent, according to Autodata.

''We're focused on returning our business to profitability in North America, full stop,'' Ford Chief Internal Sales analyst George Pipas said. ''I wouldn't want to comment on sales rankings ... It's just not that important right now.'' November marked the first time since 2002 that Ford slipped to No. 4 in U.S. sales, which happened largely because it decided to pull back on sales incentives, said Alex Rosten, industry analyst with Edmunds.com.

''They didn't launch their incentive program until mid-month,'' Rosten added. ''GM and Dodge were definitely more aggressive in incentive spending on trucks and SUVs.'' Ford said its car sales were down 3 percent, mostly due to lower demand from fleet customers, while truck sales were off 13 percent. Showroom sales fell 7 percent, which Pipas called ''disappointing.'' ''We had our sights set higher,'' he said.

Ford cut planned fourth-quarter production further by 15,000 units to 620,000 vehicles, down 22 percent from a year ago. It said it expects first-quarter production to be down 14 percent to 750,000 units. Ford had said earlier production in the first half of 2007 would be 8 percent to 12 percent lower.

GM SAYS LARGE SUVS, TRUCKS STABLE GM set its first-quarter production target 9 percent lower than a year ago at 1.4 million vehicles.

Despite weaker industry-wide auto sales in recent months, GM's chief sales analyst, Paul Ballew, said the automaker still expected 2007 sales to hold flat from this year's total with sales of trucks and large SUVs holding steady.

GM reduced sales to corporate fleet customers, including car rental companies, by 7 percent as part of a strategy to move away from those low-margin deals. But November retail sales were up 11 percent, and Ballew said the automaker was on track to hit its 2006 showroom sales goal of 3 million units.

GM and Ford both offer year-end incentives to boost demand, but both cut incentive spending in November, analysts said.

Chrysler raised its discount offerings slightly in November to an industry-leading average of $4,224 per vehicle, according to an analysis by Edmunds.com, while Ford spent $3,326 in incentives per vehicle and GM spent $2,539 per vehicle.

REUTERS PV ND1352