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DETROIT (AP) _ General Motors Corp. stock was downgraded for a second straight day Thursday.

UBS Warburg's decision to downgrade the stock from ``buy'' to ``hold'' came a day after Banc of America switched GM to ``market perform'' from ``buy.''

UBS Warburg said its move was based on concern over GM's pension liability.

``The pension fund poses two major risks _ mandatory funding requirements and a hit to expected earnings,'' said the report written by UBS Warburg analysts Saul Rubin and Mark Doehla.

There also is a risk that GM's credit rating could be downgraded, the report said.

While expressing confidence in the automaker's core operations, its pension obligations could drag down earnings $3.00 per share relative to 2002 earnings by 2005, the analysts wrote.

For that to happen, the S&P 500 index would have to fall 20 percent for the year and gain 7 percent in the next three, according to the report.

``That would almost certainly jeopardize GM's bid to make $10 a share by mid-decade,'' the report said.

UBS Warburg lowered its 2003 earnings per share estimate for GM from $6.50 to $4.60.

GM spokesman Jerry Dubrowski called the report ``speculative,'' saying GM's pension fund performance should not be tied directly to the performance of the S&P 500.

``The portfolio for the General Motors pension plan is very diverse and is not necessarily tied to the performance of U.S. equity markets,'' said Dubrowski.

He said pension and retiree health care funding is still a ``challenge'' to the automaker but called it ``manageable,'' pointing out the company made a $2.2 billion cash contribution in April and hoped to raise $10 billion by the end of the year through increased vehicle sales and through a special securities offering.

Banc of America analyst Ronald Tadross also lowered his 2003 earnings estimates for GM and Ford Motor Co., saying each would be forced to answer the enhanced powertrain warranty announced Sunday by DaimlerChrysler AG.

The seven-year/70,000-mile limited powertrain warranty became available Tuesday on all purchased or leased Chrysler, Jeep and Dodge brand vehicles. It covers engines, transmissions/transaxles, transfer cases and axles and is transferable to subsequent owners at no extra cost.

GM's top sales and marketing analyst said Thursday the automaker had no intention of matching Chrysler's offer because the company scored well in the most recent quality survey by J.D. Power and Associates.

``We're not doing it. We don't see the need,'' said Paul Ballew, executive director, market and industry analysis, during a briefing with reporters at GM headquarters.

Ford spokesman Dave Reuter said Wednesday that the No. 2 automaker was not ready to match DaimlerChrysler's warranty.

Shares of GM gained 11 cents in trading Thursday to close at $47.72 on the New York Stock Exchange.

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On the Net:

General Motors Corp., http://www.gm.com

UBS Warburg, http://www.ubswarburg.com