Ford Motor Co posted a smaller-than-expected first-quarter loss on Friday amid the auto sector downturn and said it was on track to at least break even in 2011 and did not expect to seek U.S. government loans.

The company also said it had burned through $3.7 billion of automotive cash in the first quarter, a sharp drop from the second half of last year, and ended March with $21.3 billion in gross cash, sending its shares up nearly 18 percent in premarket trading.

Ford posted a net loss of $1.43 billion, or 60 cents per share, for the first quarter, compared with net income of $70 million, or 3 cents per share, a year earlier.

The loss from continuing operations and excluding one-time items came to 75 cents per share. Analysts on average expected a loss of $1.23 on that basis, according to Reuters Estimates.

Our results in the first quarter reflected the extremely difficult business environment and weak demand for autos around the world, Chief Executive Alan Mulally said in a statement.

Still, Chief Financial Officer Lewis Booth called the results encouraging and said the automaker expected the first quarter to have the worst cash burn of the year.

Rather than the quarterly results, investors are more focused on Ford's liquidity, its full-year outlook for U.S. auto industry sales and its ability to navigate the economic downturn. The struggles of rivals General Motors Corp and Chrysler are at the center of Wall Street's attention.

Ford has not sought U.S. government aid, setting it apart from GM and Chrysler, which are operating on $17.4 billion of federal loans and have sought more to stave off bankruptcy.

Ford posted a 2008 net loss of $14.7 billion, a company record, and has reported losses of about $30 billion over the past three years.

Ford shares were up 17.6 percent at $5.28 in trading before the market opened. They have risen from a 27-year-low of $1.02 in November, when automakers were in the process of appealing for emergency loans.

(Reporting by David Bailey and Poornima Gupta; Editing by Lisa Von Ahn)

Ford Motor Company