Strong credit metrics
Ford’s IG rating and strong credit metrics are supported by the company’s diverse sources of profit generation and operational efficiency gains.
Positive global demand and a competitive, sustainable operating model underpin its balance sheet and liquidity strength.
BB-/Ba3
2017-2018
2019-2020
2021-2022
2023
2013-2016
BBB-/Baa3
BB+/Ba1
BB/Ba2
BBB/Baa2
BBB+/Baa1
2013-2016
2017-2018
2019-2020
2021-2022
2023
A challenging environment
The operating environment becomes more challenging due to rising incen-tives, weaker demand in key regions, higher commodity costs and Ford’s heavier investment in electric vehicles.
Ford had overcome similar operational hurdles in the past and moved into a transition phase to reposition the business model for future mega trends, launching a large, multi-year, multi-billion-dollar industrial restructuring programme.
It undertook prudent risk management and the strong capital structure in its captive finance business remained a reliable pillar of its business model.
Pandemic ratings cut
Macro pressures and uncompetitive products pressured earnings and cash flow into 2019, although strong liquidity rebuilt earlier in the decade supported the company’s restructuring plan actions. In 2020, the entire automotive sector faced risks to sales from the pandemic.
Ford’s adherence to its tested model of a well-capitalised, captive finance business and a liquid industrial business enabled it to weather COVID-19 challenges, launch relevant new products and redesign operations for alternative fuel vehicles.
2013-2016
2017-2018
2019-2020
2021-2022
2023
Ford’s favourable moves
Although the auto sector was challenged by a shortage of semiconductors, Ford made effective cost-reductions, had favourable product cadence and its pricing supported cashflows.
This led us to retain our confidence in the company’s business model as it had learned from past experience.
2013-2016
2017-2018
2019-2020
2021-2022
2023
Positive outlook
Ford faces sector-wide concerns such as: supply-chain challenges, elevated commodity and logistics costs, rising interest rates, and inflation impacting consumer confidence. Still, the credit derives solid support from its ongoing cost-reduction programmes, operatio-nal improvements globally, robust product pricing and a strong liquidity position. Ford has invested in electrifi-cation and changes to its automotive segment reporting have improved the visibility of its EV profitability. The company delivered solid results in Q1 2023 and maintained its earnings expectations for the year, reinforcing our positive stance.
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Credit ratings:
Our view:
2013-2016
2017-2018
2019-2020
2021-2022
2023