Ford Motor Co has said that its profits could decline by 50% in the first quarter — a bigger drop than analysts predicted — as the car maker cuts back production amid a declining US market and problems with rising costs.

Ford’s current projection for $9 billion in pre-tax profits for the 2017 fiscal year compares with $10.4 billion in 2016. The first quarter will be “as bad as it gets for the company this year”, according to CFO Bob Shanks.

Ford began the year estimating a 4% fall in North American vehicle production in the first quarter, as US car demand slows following seven years of growth. CEO Mark Fields has said profits will fall this year before rebounding in 2018.

Higher investment and commodity costs, slower sales — mainly due to a drop in deliveries to fleet customers — and “unfavourable” exchange rates are among the factors Ford cited for its earnings slump in the first quarter.