Ford's credit rating downgraded to one notch above 'junk' status
US automotive giant Ford has had the rating on its long-term debt downgraded to just one notch above junk status at Moody's Investors Service, putting the firm at the bottom rung of the investment-grade ladder.
Ford Motor Co.
$12.20
11:10 01/05/24
The ratings agency said the downgrade in Ford's rating to Baa3 reflected "the erosion in the company's global business position" and the challenges the carmaker will soon face in the implementation of its Fitness Redesign program.
Moody's highlighted negative developments such as softening margins in North America, news that its Chinese operations had swung to a loss of $633m in the first half, pressure on its South American unit which lost $750m last year and continued losses in Europe, which it said were likely to worsen as a result of Brexit-related chaos.
It added that with such a negative outlook, a further downgrade into junk status seemed more likely than an upgrade at this point.
Moody's said the rating could be downgraded again by early-to-mid 2019.
As of 1200 BST, Ford shares had lost as much as 0.50% in pre-market trade to $9.92 each.