Michael had top sustained winds of 150 miles per hour as its core moved over Florida's Panhandle earlier in the afternoon as forecasters warned rain could reach up to a foot and the life-threatening storm surge could swell to 14 feet (4m).
At 3 p.m. EDT (1900 GMT), the center of the storm was a few miles northwest of Mexico Beach and about 20 miles (30 km) southeast of Panama City.
Houses along a main road heading towards Mexico beach are completely destroyed by risky winds in Hurricane Michael.
After carving an agonizing path of destruction across the Florida Panhandle, Georgia and southeastern Alabama for almost 10 hours and killing at least two people, Hurricane Michael finally slowed to a tropical storm at midnight and continued to weaken early Thursday. It strengthened from a tropical storm on Sunday to a Category 1 hurricane with 75-mph winds on Monday.
Residents of Georgia and Alabama have been hit with power blackouts after the hurricane crossed into the southeastern part of the states.
"We are in new territory", National Hurricane Center (NHC) Meteorologist Dennis Feltgen wrote on Facebook.
About 162,000 homes and business customers were already without power around mid-afternoon in Florida, Georgia and Alabama, utility companies said.
Bill Manning, a 63-year-old supermarket employee, fled his camper van in Panama City for safer quarters in a hotel only to see the electricity there go out. "I didn't expect all this", he said.
The governors of North and SC urged residents to brace for heavy rain and storm-force winds as Michael plowed northward up the Atlantic seaboard. One video shows a piece of metal falling off the roof.
In the case of Michael the damage will be mainly from wind rather than rain. 4 storm to hit the Florida Panhandle (in records dating back to 1851.) The storm started off as a tropical depression the weekend before, and had reached Category 2 strength just a day before it hit landfall.
Shredded trees, derailed train cars and a sunken trailer are seen in the aftermath of Hurricane Michael in Panama City, Fla., Oct. 10, 2018.
-Strorm riders: Roughly 375,000 people in Florida warned to evacuate; many refused. "Houses that have been there forever are just shattered".
"This happened so quickly, we weren't exactly prepared", he said.
The National Weather Service says tornadoes are possible across the Florida Panhandle, southeast Georgia and southern SC through Thursday morning as the hurricane now moves inland. Some of those areas are still working to recover from Hurricane Florence.
Scott spoke Wednesday morning with Trump, who signed a pre-landfall emergency declaration Tuesday ensuring that federal resources would be available before and after the storm in the 35 counties where the governor declared a state of emergency.
The Pentagon said it had pre-positioned more than 2,200 active-duty military personnel, along with helicopters, high-water vehicles and swift-water boats for deployment as needed. Storm surge is going to be the worse where eye makes landfall - just to the east or south of where the eye makes landfall...
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