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Ford Set To Unveil Small Car Strategy

Reacting to what it sees as a rapid and permanent shift in consumer preferences, Ford plans to announce Thursday that it is drastically altering its focus and will build more small cars.

Among the changes, it reportedly will announce that it is converting three of its North American assembly plants from trucks to cars, according to people familiar with the plans.

Ford also will realign factories to manufacture more fuel-efficient engines and produce six of its next European car models for the United States market. And it will end speculation about its Mercury division by making the brand an integral part of its new small-car strategy. The sweeping changes are the result of months of strategic discussions in the wake of rising fuel prices and the collapsing truck market.

A large part of Ford's future car lineup will be based on vehicles currently under development for the European market. By 2010, it plans to begin assembling six of its upcoming European car models in North America, starting with the Ford Fiesta subcompact. "We don't have a sustainable company if we don't do this," CEO Alan R. Mulally, recently told members of his management team.

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