FORD Motor Co, the second-biggest United States-based auto maker, said its fourth-quarter loss narrowed to US$2.75 billion after reducing costs through plant closings and job cuts.

The loss of US$1.30 a share compares with a deficit of US$5.63 billion, or US$2.98, a year earlier, Ford said in a statement distributed yesterday at its Dearborn, Michigan, headquarters.

The results capped Chief Executive Officer Alan Mulally's first full year at Ford. Under Mulally, Ford has closed plants and cut jobs as the company moved to reduce factory capacity to match lower sales and market share in the US, the auto maker's largest market.

"We're delighted with what they've done to start to restructure the company," said Pete Hastings, a fixed-income analyst at Morgan Keegan & Co in Memphis, Tennessee, before the figures were released.

Excluding costs the company considers one-time items, the loss was US$429 million, or 20 cents a share. On that basis, analysts expected a loss of 24 cents, the average of 13 estimates compiled by Bloomberg News.

Ford also said it expects its 2008 loss to narrow compared with 2007 results. The company plans additional buyout offers for US factory workers, Mulally said in the statement.

With the results posted yesterday, Mulally supervised a US$2.67 billion loss in 2007 following a record US$12.6 billion loss the year before. Mulally told reporters after a speech two days ago that "we're going to have a terrific update on Thursday."

Any celebration may be short-lived as the US economy faces a possible recession this year, and forecasters say demand for new autos may fall to a 10-year low.

"2008 is going to be a challenging year for anybody connected to consumers," Hastings said.

Under Mulally, Ford has shut or scheduled to close 10 North American plants and cut salaried and factory jobs. Mulally said two days ago that Ford is watching the economy and would adjust its revamping plan. At that time, he said there were no plans for further plant shutdowns.

Ford last year had buyouts and early retirements for 33,600 US factory workers. The company and the United Auto Workers union are discussing additional buyouts. Ford also trimmed about 10,000 salaried jobs in 2007.