Key dealer says Ford not 'defending' truck franchise

LAS VEGAS, Feb 3 (Reuters) The head of the second-largest Ford Motor Co dealership group said the automaker was not doing enough to defend the market-leading position of its F-series pickup trucks.

''What's really bothering us at Ford has been the weak F-Series sales the last two months,'' Earl Hesterberg said yesterday.

chief executive officer of Group 1 Automotive Inc. ''For most Ford dealers, especially dealers outside the urban areas, that's really our bread and butter,'' he said.

Ford, which is racing to cut jobs and shutter plants as its U.S. market share declines, reported a 5-percent drop in retail sales for January.

Sales of its F-Series pickup trucks, which have long ranked as the best-selling vehicles in America, were down 15 percent in January. The company has warned that it would see its overall market share fall through the third quarter.

Hesterberg, who was speaking on the sidelines of an automotive conference organized by J.D. Power, said Ford needed to shore up support for its F-Series trucks at the showroom floor.

''We certainly don't think Ford has been defending the F-Series for the past several months,'' he said. ''Now what does that mean? Does it mean advertising? Does it mean incentives? I don't really know, but I can tell you other Ford dealers that I talk to - and we're the No. 2 Ford dealer-- for us the F-Series is our lifeblood.'' Analysts have cautioned that Ford's F-series trucks also face tougher competition in coming months from revamped truck offerings from rivals General Motors Corp. and Toyota Motor Co. Ford Chief Executive Alan Mulally was scheduled to meet with dealers this weekend in Las Vegas, his first appearance at a national dealer convention since taking the top job at the automaker last year.

A Ford spokesman could not be immediately reached for comment.

Separately, Hesterberg said he remained concerned that inventories could build back up for the U.S. automakers this year as they did last year, raising costs for dealers who are forced to finance the unsold vehicles.

''I absolutely have a concern about inventories and it's been an ongoing concern in our company for six to nine months,'' he said.

Hesterberg said that the U.S. automakers needed to break out of the cycle of sharp declines in monthly showroom sales that he said were cutting into the profitability of their dealers.

''They have to arrest the year over year significant decline in retail sales,'' he said. ''You can always have a month when you're down 2 percent over last year, but when you're having consecutive months when you're down (by double digits) your distribution network is going to get weaker.'' Group 1 Automotive is based in Houston.

Reuters SBA VP0715