PREVIEW-Ford seen posting Q1 loss, focus on sector turmoil

* What: Ford Q1 results Friday
* Analysts on average expect a $1.23/share loss ex-items
* Ford shares up 4.9 pct at $4.49 on Thursday

By David Bailey
DETROIT, April 23 (Reuters) - Ford Motor Co is
expected to post a large first-quarter net loss amid the global
economic downturn that has pressured results in the United
States, Western Europe and other developed economies.
Still, investors are expected to be more focused on how
much cash the automaker ran through in the first three months
of the year, the available cash at the end of March and its
U.S. auto sales outlook for the rest of 2009.
Ford, the only U.S. automaker not operating on emergency
loans from the U.S. government, posted a record $14.7 billion
net loss in 2008 and its losses have totaled $30 billion over
the past three calendar years.
Investors will likely look past the raw numbers to what
Ford has to say about its ability to operate without help from
the government and any benefit it might reap from the struggles
of rivals General Motors Corp and Chrysler LLC
[nN22256068]
Analysts expect Ford to post losses across the regions. On
average, the first-quarter loss is expected to be $1.23 per
share excluding one-time items, according to Reuters Estimates.
It posted a 20 cent per share profit a year earlier.
Ford expects its automotive operating related cash flow to
be significantly improved in 2009 from the $21 billion it
burned through last year, but still negative.
The automaker ended 2008 with $13.4 billion of cash, but
drew a $10.1 billion line of credit in the first quarter to
support the turnaround plan.
"We expect management to focus on sequential firming as a
result of international incentive programs and progress Ford
has made in strengthening its balance sheet," Barclays Capital
analyst Brian Johnson said in a note to clients on Thursday.
Earlier this week, Ford investors got a shot in the arm
when Goldman Sachs upgraded it to "buy", saying that it
expected the automaker to benefit the most from the structural
changes within the sector. [nBNG475818]
Ford announced earlier this month it had slashed its
automotive debt by $9.9 billion, or by about 38 percent, to
bolster its finances amid the deep industry downturn.
[nN06387216]
Johnson said Ford's debt swap and potential market share
gains due to GM and Chrysler struggles were positives for Ford,
but he was skeptical of the recent rise in the share price.

OUTLOOK, RESTRUCTURING A FOCUS
Ford shares closed up 4.9 percent at $4.49 on Thursday,
bouncing back from the 27-year-low of $1.02 it hit in November
during the fractious Washington debate over emergency funding
for the auto sector.
Ford's share count could more than double if it pays half
of its VEBA obligations in stock at about a $2 share price and
if it pays the obligation in cash, the increase in debt likely
would offset the benefit of no dilution, Johnson said.
Ford has been restructuring its operations for several
years, including an extensive plan to convert plants in North
America to build smaller, more fuel efficient vehicles.
GM and Chrysler have been operating with $17.4 billion in
emergency U.S. government loans. The Obama administration has
rejected GM's restructuring plan and ordered the automaker to
cut deeper and move faster if it wants continued support from
the government.
For Chrysler, the Obama administration has ordered the
automaker to complete an alliance with Italy's Fiat SpA
and cuts to its debt and labor costs by the end of
April to maintain current support and get additional funding.
The New York Times reported on Thursday the U.S. Treasury
was preparing a bankruptcy filing for Chrysler to finalize the
Fiat alliance process that could come as early as next week.
[nWEN7746]
Johnson said Ford is not likely to need government cash
given the debt exchange and improvement in Europe and Brazil
due to scrappage programs and other incentives.
"We do not view a GM or Chrysler (bankruptcy) filing as
necessitating a Ford filing," Johnson said.
Goldman Sachs analyst Patrick Archambault also said he
believed Ford would avoid bankruptcy.
U.S. auto sales were down more than 38 percent through the
first three months of the year, reaching their lowest run rates
in 27 years under the severe U.S. recession.
In recent months, programs that provide incentives when
owners turn in older vehicles for new purchases have supported
sales in some European countries, helping bolster Ford sales
there. Similar programs could be adopted in the United States.
Ford also may update investors on its Swedish Volvo car
brand. Ford has been in discussions with potential buyers for
the brand, the last from its former premier auto group.
The automaker sold off Aston Martin, Jaguar and Land Rover
to raise cash for a turnaround and to narrow its focus to
mainly the Ford, Lincoln and Mercury brands.
(Reporting by David Bailey; editing by Patrick Fitzgibbons and
Andre Grenon)
((david.bailey@thomsonreuters.com +1 313 967 1910; Reuters
Messaging: david.bailey.reuters.com@reuters.net))
Keywords: FORD/RESULTS

(C) Reuters 2009. All rights reserved. Republication or redistribution of
Reuters content, including by caching, framing or similar means, is expressly
prohibited without the prior written consent of Reuters. Reuters and the Reuters
sphere logo are registered trademarks and trademarks of the Reuters group of
companies around the world.

nN23254874