November 6, 2008 / 5:31 PM / 10 years ago

UPDATE 1-Citi widens GM Q3 loss view; Ford estimate unchanged

(Recasts, adds analyst comments, background)

Nov 6 (Reuters) - Citigroup widened its third-quarter loss estimate on General Motors Corp (GM.N), but left his forecast on Ford Motor Co (F.N) unchanged, as the auto industry is steeped in a deep downturn.

A day before the two U.S. automakers report quarterly results, analyst Itay Michaeli widened his third-quarter loss estimate on GM to reflect the quarterly loss at finance company GMAC LLC, in which GM owns 49 percent.

On Wednesday, GMAC posted a third-quarter loss of $2.52 billion, hurt by slumps in the housing and auto markets, and said its Residential Capital LLC mortgage unit may fail.

Analyst Michaeli widened his fourth-quarter loss estimates on both automakers, as weaker production rates are expected in the quarter.

Looking ahead at the third-quarter results announcement, Michaeli said, “We look forward to GM’s liquidity and restructuring update and possibly a new round of cost cutting.”

Rising pension risk, cash flow and liquidity are major concerns at Ford, the analyst said.

Shares of GM were trading down 75 cents at $4.81, while those of Ford were down 21 cents at $1.88 midday Thursday on the New York Stock Exchange.

For Citigroup’s estimates on the companies, please double-click on [ID:nWNAB9292] . (Reporting by Eric Yep in Bangalore; Editing by Pratish Narayanan)

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