Ford’s Credit Rating Raised Two Levels by Moody’s
DETROIT - Ford Motor Co.’s credit rating was raised two levels by Moody’s Investors Service, which said the automaker’s operating performance “significantly exceeded” expectations, Bloomberg reported.
The upgrade in Ford’s corporate family rating to Ba2 from B1 is the fifth Moody’s has given the automaker in the last 13 months. Ford, which has $27.3 billion in automotive debt, remains two levels below investment grade. Moody’s said it has a stable outlook on Ford’s debt and its finance subsidiary, Ford Motor Credit Co.
“The company is well positioned to continue generating strong earnings and cash flow through 2011, and to further strengthen its balance sheet,” J. Bruce Clark, Moody’s senior vice president, said in a statement. “At the same time that the industry’s business practices have become more disciplined, Ford is coming to market with an exceptionally strong product portfolio.”
Returning to investment grade, which Ford slipped out of in 2005, has become “a rallying cry within the company,” Chief Financial Officer Lewis Booth said last month. Ford paid down debt by $7 billion in the second quarter. It continues to have larger obligations than General Motors Co., which had its balance sheet cleansed in bankruptcy last year.
Ford is the only major U.S. automaker that didn’t seek bankruptcy protection with the help of the U.S. government in 2009.
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