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Moody’s Cuts Ford Rating to “Junk”
Ford Motor Co.’s credit rating has been reduced to one notch below investment grade by Moody’s Investors Service.
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Ford Motor Co.’s credit rating has been reduced to one notch below investment grade by Moody’s Investors Service.
Moody’s says the drop into “junk” territory reflects the rating service’s worries about Ford’s ability to improve below-grade cash flow and profit margins over the next two years.
Last year the service changed its rating outlook for Ford from “stable” to “negative.” It later lowered Ford by one position to its lowest investment grade, Baa3.
At the time, Moody’s cautioned that Fitness Redesign, Ford’s $11 billion global overhaul, is necessary but unlikely to deliver substantive financial and operating benefits within two years. The rating service warned that a further downgrade was likely unless the carmaker showed “clear progress” by mid-2019.
Ford remains rated two steps above junk status by Fitch Ratings and S&P Global Ratings.
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