UPDATE 1-Shares of GM, Ford down on market-share loss
(Adds background, stock activity, analyst quote, byline)
By Jui Chakravorty
DETROIT, Dec 19 (Reuters) - Shares of General Motors Corp.
fell nearly 4 percent on Monday after a report from J.D. Power
and Associates said the Big Three U.S. automakers continued to
lose retail market share to Japanese rivals in December.
The industry tracking firm's closely watched Power
Information Network said GM's retail market share fell
to 21.7 percent in the first 11 days of December, from 22.4
percent in the same period a year ago.
Ford Motor Co.'s retail market share fell to 15.8
percent compared with 17.9 percent a year earlier, and
DaimlerChrysler AG's share fell to 12.6 percent from
13.3 percent, the study said.
Toyota Motor Corp. <7203.T> and Honda Motor Co. Ltd.
<7267.T> gained market share in the same period.
GM shares fell 84 cents, or 3.8 percent, to $21.05 in
Monday trading on the New York Stock Exchange.
"The loss of market share is a continuation of what we have
been seeing for a long time," Burnham Securities analyst David
Healy said. "And it does not please anyone."
Healy expects December sales of foreign brands to rise 5
percent from a year earlier, while expecting a double-digit
drop in December sales at GM and Ford.
Shares of GM have plunged more than 47 percent this year,
as the world's largest automaker has struggled with not only
loss of market share to foreign rivals, but high health-care
and commodities costs and slumping sales of its large sport
utility vehicles -- its longtime profit generators.
To compound matters, a strike at GM's main auto parts
supplier -- bankrupt Delphi Corp. -- could shut down
plants and cause GM to burn through billions of dollars a week,
analysts have said.
Delphi has said it will ask the court to negate its labor
contracts if it does not reach an agreement with its union.
Ford shares, which have fallen 44 percent this year, fell 6
cents, or 0.7 percent, to $8.24 in Monday trade. Fitch Ratings
on Monday cut its ratings on Ford to junk status, reflecting
ongoing market share losses, slumping sales of SUVs and
competition from foreign rivals.
Toyota's retail market share rose to 17.1 percent from 15.5
percent in the first 11 days of December, while Honda's share
rose to 11.8 percent from 10.5 percent a year earlier. Nissan
Motor Co. Ltd's <7201.T> market share remained flat at 7.4
percent.
Overall, industry new-vehicle sales were down 14 percent
for the first 11 days of December, the J.D. Power report said.
"December 2004 was an exceptionally strong sales month ...
driven by year-end incentive programs," Bob Schnorbus, chief
economist of global forecasting at J.D. Power said. "That makes
any year-over-year comparison hard to make, especially with
regard to the Big Three."
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