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Finance operation keeps Ford in the black

Ford Motor Company yesterday reported sharply higher third-quarter losses from its North American automotive and luxury car operations.

But a 46% jump in earnings from financial services helped the motor vehicle manufacturer improve overall earnings and raise its profit estimate for 2004.

Ford's net third-quarter earnings were $266m (£147m) compared with a loss of $25m (£13.9m) a year earlier. Revenues climbed to $39bn (£21.5bn) from $36.7bn (£20.29bn).

Don Leclair, Ford's chief financial officer, said yesterday that while new models should improve Ford's market share in the final three months of the year, automotive profits would remain under pressure from price competition in the US and production cuts at Jaguar.

Pre-tax losses from Ford’s global automotive operations climbed to $609m (£336.7m) in the third quarter from $528m (£292m) a year earlier. The latest figure excludes $312m (£172.5m) in write-offs and operating losses from Ford's Formula One racing interests, which were recently put up for sale.

Ford Motor Credit reported net third-quarter income of $734m (£406m) up from $504m (£279m) a year earlier.

Losses in North America widened to $481m (£266m) from $373m (£206m) due to lower production volumes, the impact of the weak dollar and the expiry of currency hedges.

Ford's US market share dropped by 1.4 percentage points in the third quarter to 18.5 per cent, mostly reflecting a drive to lower its presence in the low-margin car rental business.

Third-quarter losses at the Premier Automotive Group jumped to $171m (£94.5m) from $24m (£13.2m).

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