Ford's 1q Loss Less Than Expected

April 25, 2009|By Ken Bensinger | Ken Bensinger,Tribune Newspapers

Amid swirling rumors about the fate of the U.S. auto industry, Ford Motor Co., the only domestic carmaker not to rely on federal aid, reported a first-quarter loss of $1.4 billion, bettering analysts' expectations.

Although Ford's results were received enthusiastically on Wall Street, they were in great part overshadowed by reports that the Obama administration was preparing a bankruptcy filing for Chrysler and that General Motors Corp. was considering ending its Pontiac brand.

In addition, the Treasury Department confirmed Friday that it had given GM an additional $2 billion in funding, raising the company's total federal loans to $15.4 billion to date.

"We appreciate President Obama's and his administration's ongoing support of GM and the domestic U.S. auto industry as we undertake the difficult but necessary actions to reinvent our company," said GM in a statement.

Separately, the company said it had not announced any changes in its plans for Pontiac, calling reports of the brand's demise "media speculation." GM has been given until June 1 to restructure obligations to bondholders and the United Auto Workers union or face possible bankruptcy, but the administration has indicated it would support the automaker regardless.

The administration has made fewer promises to Chrysler, and unlike with GM, it has not extended any further loans to the smallest U.S. automaker, although it has indicated it would be prepared to offer up to $500 million above the $4 billion the company has borrowed.

The administration gave Chrysler until May 1 to negotiate a merger with Italian automaker Fiat and work out deals to reduce obligations with debtholders and unions. Articles published in The New York Times and The Wall Street Journal indicated that the Treasury's Autos Task Force had asked Chrysler to prepare a bankruptcy filing next week.

Chrysler Vice Chairman Jim Press denied the reports Friday and said that a bankruptcy filing was not imminent.

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