J.P. Morgan turned negative on Ford ( F) Thursday, downgrading the stock on concerns that its product mix is in trouble and its biggest-selling truck is about to be torpedoed by General Motors ( GM).

The brokerage lowered Ford to underweight from overweight, slashed its 2006 earnings estimate to 50 cents a share from $1.15 a share, and cut its 2007 estimate to 60 cents from $1 a share. The Thomson First Call consensus estimates are 61 cents a share for 2006 and 70 cents a share for 2007.

Ford shares lost 25 cents to $7.60 on Instinet following the downgrade. The stock was trading above $10 as recently as October, but has fallen steadily along with shares of GM amid pessimism that current cost initiatives will be enough to revive their flagging prospects.

Among other things, J.P. Morgan argued that Ford is seeing a preponderance of lower-margin sales to rental outlets, and that its F-150 pickup truck, which makes up around 20% of its North American volume, will see formidable competition from GM's new T-900 in coming years.

"The company's product mix is deteriorating faster than we previously expected," the brokerage wrote. "In 2006, fleet sales are rising faster than expected, and the company is losing notable volumes in the high-profit mid/large SUV space. Looking into 2007, we expect GM's launch of the T-900 full-size pickup range to pressure Ford's F-150, which has so far faced aged competition.

"Cost-cutting potential remains interesting, in our view, but we were disappointed by a relative lack of detail in the company's recently announced Way Forward restructuring plan. Mark Fields' initiatives hold promise on the product front, in our view, but he seems unlikely to be able to notably influence Ford's near-term product cadence."