Ford Talks Money at Frankfurt Motor Show
For the past two weeks Ford has spent a decent amount of time pulling the covers off of concepts in Germany at the Frankfurt Motor Show. However, unlike many of their fellow automakers, Ford also devoted a time slot completely dedicated to discussing their financial situation.
Don't panic, the American automaker is not in any sort of financial crisis! In fact, it's all good, thanks to attentive and committed work, Ford is on track to paying off its $1.8-billion balance on a loan, considerably ahead of schedule. In particular, Lewis Booth, CFO, Ford said, "Earlier this week, we gave notice to our leaders and by the end of this week, we will have pre-paid the remaining amount of our term loan."1
That 's not mere millions...That's close to a two-billion dollar debt, paid in full!
Just like any other automaker, Ford has other debts to pay off, specifically $14 billion, as of the end June. But, the premature pay-off of the abovementioned loan emphasizes the American automaker's pledge to coming out ahead, as early as possible. To keep things in perspective, keep in mind that only two years ago, the American automaker was burdened with a $33.6 billion debt.
Even though Ford is not out of the red yet, Laird Noller Topeka avidly believes that the American automaker is quickly approaching the end. In an effort to enhance its debt rating to investment grade standing, the American automaker is also in the process of discussing and agreeing upon a new contract with the UAW that maintains wages for approximately a four-year period.
Why should consumers care? Well, returning to investment-grade status would eventually lower Ford's cost of borrowing funds, granting the automaker the ability to invest more in revitalizing their vehicle lineup. And, it's quite obvious that "new" and "improved" is what entices auto buyers to buy.
Make sure to check back regularly for more Ford news. Laird Noller Topeka, located at 2245 S. Topeka Blvd - and - 2946 S. Kansas Ave - Topeka, Kansas 66611 is devoted to keeping you up to date. Don't forget to check out the newness and improvements Ford is bringing to their 2012 model lineup online at our new Ford showroom.