One of the world's oldest automakers, the Ford Motor Co., posted its worst quarterly performance in company history Thursday.

Ford lost US$8.7 billion in the second quarter as buying trends shifted away from gas-guzzling trucks and SUVs towards fuel-efficient small vehicles and hybrids.

Thursday's net loss factors in $8.03 billion in write-offs due to large declines in U.S. truck and SUV sales. Shares dropped $3.88 per share in the second quarter, compared with a year-ago net profit of $750 million or 31 cents per share.

The company said Thursday it has enough liquidity to weather the economic downturn without the need for more loans.

"We are pleased that we went to the capital markets at the right time," Ford President and CEO Alan Mulally said in a conference call with investors and media, according to The Associated Press. "We have the scale, the expertise and the financing to execute our plan."

In an effort to adjust to new economic realities, the company also announced Thursday it will become the latest North American automaker to make efforts to adapt to a rapidly changing market. Ford said it will significantly accelerate its transformation plan, adding new fuel-efficient small cars to its North American offerings and realigning production schedules.

Wall Street responded negatively in early morning trading, despite the announcement that the company will retool some plants to build smaller, more fuel efficient vehicles. Ford shares fell 58 cents to $5.45 in Thursday morning trading.

Ford will bring six small cars from its European line to North America by the end of 2012 and will realign three truck and SUV plants in the U.S. to build the smaller vehicles.

Ford is also accelerating the introduction of its EcoBoost fuel efficient motors and new four-cylinder engines, as well as boosting hybrid production.

Buzz Hargrove, the president of the Canada Auto Workers union, was not optimistic about Ford's plans.

"It's hard to be positive or to get excited about this," he told CTV Newsnet Thursday.

But he said that he hoped that the plan to bring in the European cars will result in new investment in North America.

Here is a list of the plants that will undergo conversions:

  • Wayne, Michigan's truck plant, which currently builds the Ford.
  • Expedition and Lincoln Navigator full-size SUVs, will be converted beginning this December to produce small cars.
  • The Cuautitlan assembly plant in Mexico, which currently produces F-Series pickups, will be converted to begin production of the new Fiesta small car for North America in early 2010.
  • The Louisville, Ky., assembly plant which builds the Ford Explorer mid-size SUV, will be converted to produce small vehicles beginning in 2011.

"What you're seeing is kind of a bubble that we're going to go through ... but early on we're going to see cost savings because of the economies of scale that we're getting as we develop more and more vehicles off of fewer platforms," Chief Financial Officer Don Leclair said.

With files from The Associated Press