As Ford Motor Co.'s financial results continue to improve, CEO Alan Mulally sees "great options" to improve its balance sheet and return to an investment-grade credit rating.
A solid profit is expected in 2010 while for 2011 and beyond, Mulally thinks that profits would be greater based on cost savings from using common global platforms, an increasing market share and better pricing.
From a meeting where Mulally was addressing analysts, we learned that the company's No. 1 strategy is to continually improve operational performance.
Mulally said that when Ford pursues this goal, it is able to accelerate [balance sheet] improvement and it sees options open up to it. He added that Ford targets being able to get back to investment grade.
In 2005, Moody's Investors Service and Standard and Poor's lowered Ford's status to junk. In early May, Moody's raised Ford to B1, its fourth level below investment grade.
In April, Standard & Poor's maintained its B-minus credit rating on Ford, six notches below investment grade. However, Standard & Poor's revised its outlook to positive from stable indicating a better than a one-in-three chance of upgrade for the next year.