Ford sees industry rebound into 2010

CHICAGO (Reuters) - Ford Motor Co (F.N) expects U.S. auto sales to recover through the remainder of this year and near 12.5 million vehicles in 2010 as the pressure on consumer spending eases, a senior executive said on Tuesday.

Mark Fields, Ford's president for the Americas, said the No. 2 U.S. automaker did not expect the sales boom triggered by the U.S. government's "Cash for Clunkers" program in July to give way to a steep decline in the months ahead.

"We're not seeing pull-ahead sales as much as the market is telling us there's a lot of pent-up demand out there," Fields told Reuters. "We expect some (sales) growth in the third and fourth quarter. It won't be huge growth, but growth nonetheless."

Fields was speaking at an event to mark the production launch of the restyled 2010 Ford Taurus at a Chicago assembly plant.

Ford, the only U.S. automaker to have steered clear of emergency federal funding and bankruptcy, has been a major beneficiary of the government's $1 billion clunkers program.

The program offers consumers incentives of up to $4,500 to swap out of older gas guzzlers for newer and more fuel-efficient vehicles. The older vehicles are then scrapped.

The Ford Focus small sedan has been the top-selling vehicle under the U.S. government's incentive program, which faces a Senate vote this week over whether to extend it with another $2 billion in funding.

Ford posted a 2 percent gain in July sales on the success of the clunkers incentive program, its first year-on-year sales gain since late 2007.

Despite the surge in sales in late July, Fields said Ford was comfortable with its current inventory level.

The automaker ended July with a 48-day supply of vehicles but has an adequate supply of the small models such as the Focus, Fusion and Escape that sold briskly last month, Fields said.

He declined to say whether Ford is considering raising production in the remainder of 2009 as many analysts now expect.

"We have to develop that going forward," he said.

Shares in the automaker have also more than tripled over the past year and gained 40 percent over the past month as investors reacted to signs that the auto market is stabilizing.

Fields also expressed cautious optimism about 2010, saying industry sales could be "in the 12.5 million range" because of positive signs in the economy, slowing unemployment growth and rising consumer confidence.

Sales for 2009 are expected to end near 10.5 million.

The forecast for a rebound to 12.5 million next year would put the industry well above the cash-flow break-even point for Ford's rival General Motors Co GM.UL, which completed a government-financed bankruptcy in July.

Chrysler Group, now controlled by Fiat SpA (FIA.MI), needs sales to recover to the 13 million to 14 million unit-range for its turnaround to take hold, Chief Executive Sergio Marchionne said last month.

Ford has said it expects to at least break even on an annual basis in 2011. Some analysts see a prospect for the automaker to return to profit as soon as 2010.

Ford ran up losses totaling $30 billion from 2006 through 2008 as sales declined and it took charges to cut jobs and other costs.

(Reporting by Rick Popely; Editing by Gary Hill)