Trotman forecasts 2.5% sales growth in '96.(Ford Motor Co. CEO Alex Trotman)(Auto Talk)

Automotive sales should gradually improve in 1996 in the U.S. and most markets worldwide, even though the 1995 final tally will be lower than was predicted a year ago, says Ford Chairman and CEO Alex Trotman.

"The effect of last year's interest rate increases in the U.S. by the Federal Reserve was stronger than anticipated," he says, adding that tax increases in Europe and the aftermath of the Mexican peso crisis have had similar effects.

Ford forecasts a 1996 automotive market of about 15.3 million cars and trucks in the U.S. -- an increase of about 2.5% over 1995. Western Europe should be up about 3% next year to 13.8 million units, with lower taxes and possibly lower interest rates spurring growth. The rest of the world should follow current patterns with global car and truck sales reaching 50.6 million in 1996 -- 3% higher than this year, Mr. Trotman says.

The Ford chief offers his forecasts at a Ford's year-end news conference where he also outlines company plans for '96 and the rest of the decade.

He says plans call for 50% more new models worldwide over the next five years, and that Ford will save several billion dollars "compared to our prior way of doing business." Product spending as a percentage of revenue has reached its peak, and will actually decline going forward, he adds.

A key to that decline is Ford's planned 30% to 50% reduction in the number of engine and transmission combinations used worldwide. Rationalizing products and components worldwide has reduced the number of product-development personnel by 10% during 1995, mainly through the elimination of some contract work and attrition.

Mr. Trotman reinforces forecasts made earlier this year by David M. McCammon, Ford vice president for finance, that fourth-quarter and full-year profits will be lower than last year, and the company doesn't expect year-over-year improvements in earnings until the second half of 1996.

Other news from the year-end review:

* The automaker's relationship with Mazda Motor Corp. will remain the same.

* Mr. Trotman believes there will be changes in the U.S. luxury market, focusing on entry-level, somewhat smaller and more functionable luxury vehicles. He also sees some expansion in Ford's luxury car business, including a wider Jaguar lineup, by the end of the decade.

* Ford is keeping its eye on an entry into the small sport/utility segment. Mr. Trotman says he believes the popularity of vehicles such as Toyota's RAV4 will continue to grow.

* Ford will continue to look at its non-automotive financing operations, but Mr. Trotman offers no hint about their future.