GM, Ford shares decline ahead of June sales report

DETROIT (Reuters) - Shares of General Motors Corp GM.N tumbled to a 54-year low while smaller rival Ford Motor Co (F.N) shares fell as much as 10 percent on Monday on concerns record oil prices would further hit U.S. demand for vehicles.

"It's just negative momentum. A belief that car sales would be very weak in this environment," said Tim Ghriskey, chief investment officer at investment firm Solaris Asset Management.

Options strategist Frederic Ruffy at Web information site WhatsTrading.com said GM's stock is also down amid concerns about energy prices and the automaker's financial problems.

U.S. automakers including GM and Ford were expected to post double-digit decline in U.S. sales in June when they report monthly sales on Tuesday.

Overall industry-wide sales were forecast to drop to a 15-year low as record gasoline prices sapped demand for large trucks and SUVs.

Forecasts for the annualized sales rate range from 12.5 million units to 13.7 million units, compared with 14.3 million in May.

GM is expected to post a drop of more than 15 percent, with Ford sales seen down as much as 17 percent. Sales at Chrysler LLC are expected to be down nearly 23 percent, according to analyst forecasts.

GM shares fell as low as $10.57 on Monday, their worst level since 1954, before recovering some ground to be down 47 cents, or 4.1 percent, at $11.08 in afternoon trading on the New York Stock Exchange. The stock has now lost more than half its value since the start of the year.

Ford shares were down 3.4 percent to $4.81 in afternoon trading on NYSE after touching a low of $4.46 earlier in the session.