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With 2nd Debt Upgrade Ford Regains Control of Blue Oval Logo

Maker regains control of logo, brands and factories.

by on May.23, 2012

Back from the pawnbrokers: Ford regains control of the Blue Oval logo and other key assets.

Ford is out of hock, so to speak.  With Moody’s Investor’s Services upgrading the maker’s debt to “investment grade,” the second-largest automaker has done more than just fulfill the key goal of CEO Alan Mulally.  It regains control of assets that include its factories, brand names and trademarks and the familiar Blue Oval logo.

While Ford continued to use them it put those and other assets up as collateral in 2006 to secure $23.5 billion in credit.  That move, approved shortly after Mulally joined Ford from Boeing, where he had been a senior executive, helped the maker avoid the bankruptcy that nearly crushed its cross-town rivals General Motors and Chrysler.

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“The key factor in our considering an investment grade rating for Ford was whether or not the company would be able to sustain its strong performance,” said Moody’s senior vice president Bruce Clark. “We concluded that the improvements Ford has made are likely to be lasting.”

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Junk No More, Ford Regains Its Investment Grade Rating

Fitch moves, but will S&P and Moody’s follow?

by on Apr.24, 2012

Ford CEO Alan Mulally gets one of his wishes fulfilled.

Ford Motor Co. CEO Alan Mulally has reason to celebrate after achieving one of the top goals he set after joining the Detroit automaker more than five years ago; Fitch Ratings boosting the maker’s debt to investment grade status.

Though several other key ratings agencies have yet to weigh in, the move by Fitch signals growing confidence that Ford’s turnaround is sustainable – and helps the maker maintain momentum by, among other things, reducing its debt costs.  It is also expected to boost Ford’s standing in the stock market, the upgrade quickly triggering a sharp jump in Ford’s share price.

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“We are very pleased with today’s decision by Fitch,” said Bob Shanks, Ford’s Chief Financial Officer.  “It is an important proof point of the continued progress the Ford team is making with our One Ford plan.  Moving forward, we will continue to focus on driving profitable growth for all of our stakeholders. In fact, our One Ford plan includes achieving strong investment grade ratings and maintaining investment grade throughout an economic cycle.”

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Debt Rating on the Rise, Will Ford Restore Dividend?

Maker gets vote of confidence with Fitch credit upgrade.

by on Oct.21, 2011

After an initial bump look for Ford's labor costs to come down, says President Mark Fields.

Editor’s Note: This story has been revised to reflect a subsequent upgrade in Ford’s credit rating by S&P, the agency removing Ford from its CreditWatch.

With a key debt rating agency giving it the thumbs-up – and further hikes anticipated – Ford Motor Co. is signaling it may soon restore its dividend, a move that could, in turn, help revive the maker’s flagging stock price.

With Ford now indicating its new contract with the United Auto Workers Union will actually lower its labor costs, Fitch Ratings bumped the carmaker’s credit rating up a notch to “BB+” on Thursday, S&P taking the same step on Friday while also removing Ford from its CreditWatch.  Those upgrades fall just one step short of reaching the investment grade targeted by Ford CEO Alan Mulally.

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In the past, it had been expected that Ford would wait until getting that investment grade status before restoring the dividend but, during a meeting with investors, Chief Financial Officer Lewis Booth indicated the additional upgrade, “is not an absolute necessity to pay dividends.”

If anything, analysts say such a move would pay big dividends for Ford.  The quarterly payout is a requirement in some investment communities, such as insurance companies and government pension plans, according to Joe Phillippi, chief analyst with AutoTrends Consulting.

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