Gas prices derail Ford's plan to turn profit in '09

0 Comments | USA TODAY, May, 2008 | by Sharon Silke Carty

DETROIT -- Ford Motor on Thursday said fuel prices reached a "tipping point" in May that collapsed demand for the highly profitable pickups and SUVs that have helped keep the company afloat.

As a result, Ford said it no longer expects to reach profitability in 2009, the forecast CEO Alan Mulally had held out as a benchmark for investors that things actually were turning around.

"We saw a real change in industry demand for pickup trucks and SUVs in the first two weeks of May" when national average gas prices hit $3.50, Mulally said on a conference call to announce the forecast change. "It seems to us we reached a tipping point."

More worrisome: The market change could be permanent, says Mulally, who sees gas prices at $3.75 to $4.25 for the...

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