Ford planning to win back its investment grade credit rating
By Andrew C., 30 Aug, 2010. 0 Comments
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The Wall Street Journal reports that Ford Motor aims to win back the investment grade credit rating that it lost in 2005, according to sources familiar with the matter. They said that Ford, the only US carmaker that didn't need a government bailout during the economic crisis, wants to get back the investment grade rating either in 2012, or by the end of 2011. Having an investment grade rating typically means that a company could borrow money at lower interest rates. Ford retired $7 billion of debt in the second quarter, lowering annualized interest costs by over $470 million. At the end of the quarter, Ford had $27.3 billion in automotive debt. Ford anticipates that 2010 will be solidly profitable; however, it has a far heavier debt load than the post-bankruptcy GM and Chrysler because it borrowed more than $23 billion in late 2006 to fund its turnaround. Ford had been able to evade bankruptcy but it had supported its rivals in their requests for US government funding that aided in dodging a collapse of the auto parts supply base. Ford has yet to comment on this report. [via autonews - sub. required]
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