Kerkorian Cuts Stake in Ford As Confidence Crashes

Billionaire Kirk Kerkorian is facing the prospect of a massive loss on his $1bn investment in Ford after selling part of the stake and mulling the disposal of the remainder.

Kerkorian built up a 6.5% holding in the car maker earlier this year and gave his backing to management turn round plans.

But today, in a move which will be seen as a further blow to confidence in the US automotive industry, his Tracinda Investments sold some 7.3m shares for around $18m and added that it intended to sell more Ford shares "including the possible sale of all its remaining 133.5m shares, depending on market conditions and available sale prices."

Ford shares were trading at $2.33, valuing Kerkorian's remaining stake at around $311m.

Shares in car companies have slipped sharply this month because of the weakness of the US economy and depressed vehicle sales. The crisis in the industry has sparked speculation that the two other leading US car makers, GM and Chrysler, could merge but the idea has run into union opposition and criticism from analysts that it would do little to solve the problems the industry is facing.

Ford shrugged off the news that Kerkorian could sell all his stake. "We remain confident and focused on our plan to transform Ford into a profitably growing automaker," Ford spokesman, Mark Truby, said.

In the UK, Nissan is shutting one of the two production lines at its Sunderland plant for two weeks from next Monday, affecting around 800 workers.

The line, which operates two shifts, makes the company's Note and Micra models. The company said staff would continue to be paid and would come to work as normal to carry out maintenance work or undergo training. Production on the second line, which produces the Qashqai, is not affected. Nissan is also curbing production at its Barcelona factory.

Meanwhile, Ford is investigating an unofficial walk-out on Monday by some staff at its Southampton plant where it manufactures the Transit.

The action, which Ford described as "unconstitutional" and a "distraction", is understood to be in protest at the company's plans for the plant.

Ford said it intends to continue making the Transit at Southhampton beyond 2011 but at around half the current output of 70,000 vehicles a year.

Ford said it was investigating which employees walked off shift early on Monday and was considering what action to take. The plant is operating on a four-day week.