In the second quarter of 2008 the high cost of gasoline delivered losses to the Ford Motor Co. totaling $1.38 billion as consumers abandoned trucks and SUVs in favor of smaller, more fuel efficient models.

For the same period in 2007, Ford posted earnings of $258 million. The loss this year was compounded by an $8 billion loss resulting from the drop in value of various assets held by the company.

In response to the severe downward trend, Ford will be adding six small vehicles from their European line to the North American market and will convert operations in three truck and SUV plants to the production of small cars beginning in December.

Plans are also in the works for the revitalization of the Mercury line by the end of 2010, a brand whose survival has been in doubt due to a lack of new product offerings. By 2011, Ford plans to have doubled its ability to make four-cylinder engines while its hybrid offerings will also double by 2009.

Ford CEO Alan Mulally pointed to progress with the company's global product development strategy as being responsible for the necessary flexibility to respond quickly to the changes in market preference in the United States.

"We are in a stronger position than ever to leverage Ford's global assets and continue to address the pressures facing us in North America," he told journalists on Thursday, July 24 during a conference call.