Ford Motor Co. on Friday said it would cut fourth-quarter production by 21 percent and also reduce third-quarter production to accelerate its turnaround plan.

The automaker said it would cut North American production in the fourth quarter by 168,000 units and reduce third-quarter production by 20,000 vehicles.

We know this decision will have a dramatic impact on our employees, as well as our suppliers, Chief Executive Bill Ford told employees, but he said it was the right call.

He said full details of the accelerated plan would be announced in September.

Ford, which is battling shrinking U.S. market share and rising costs, had said it would accelerate its turnaround plan to respond to the weakening demand for fuel-hungry trucks and sport utility vehicles in the U.S. market as gasoline prices have remained high.

For the full year, Ford now plans to make 3.048 million vehicles in North America, down 9 percent from a year earlier.

We are determined to match production and inventories with consumer demand, said Ford's president of the Americas, Mark Fields.

We'll reduce incentive spending and inventory carrying costs for our dealers - with the intent to improve residual values for our customers.

Ford, which posted a second-quarter loss of $254 million and has hired an outside financial adviser, has said it will close 14 plants and cut up to 30,000 factory jobs to return its North American unit to profitability by 2008.

Ford Motor Company