Ford Takes Action to Address Effects of Coronavirus Pandemic; Company Offers New-Car Customers Six-Month Payment Relief
19 Março 2020 - 10:00AM
Business Wire
- $15.4 billion of additional cash on balance sheet, drawing from
two credit lines
- Dividend suspension to preserve cash and provide additional
flexibility in the current environment
- Withdrawal of company guidance for 2020 financial
performance
- Three month payment deferral for eligible U.S. new-car
customers, plus three more paid by Ford, for up to six months of
payment peace of mind
Ford Motor Company is taking a series of initiatives to further
bolster the company’s cash position amid the coronavirus health
crisis, maintain strategic flexibility on behalf of its team and
customers, and set up Ford to separate itself from competitors when
the global economy emerges from the current period of acute
uncertainty.
“Like we did in the Great Recession, Ford is managing through
the coronavirus crisis in a way that safeguards our business, our
workforce, our customers and our dealers during this vital period,”
said Ford CEO Jim Hackett. “As America’s largest producer of
vehicles and largest employer of autoworkers, we plan to emerge
from this crisis as a stronger company that can be an engine for
the recovery of the economy moving forward.”
The company today notified lenders that it will borrow the total
unused amounts against two lines of credit: $13.4 billion under its
corporate credit facility and $2 billion under its supplemental
credit facility. The incremental cash from these borrowings will be
used to offset the temporary working capital impacts of the
coronavirus-related production shut downs and to preserve Ford’s
financial flexibility.
“While we obviously didn’t foresee the coronavirus pandemic, we
have maintained a strong balance sheet and ample liquidity so that
we could weather economic uncertainty and continue to invest in our
future,” Hackett said. “Our Ford people are extremely resilient and
motivated, and I’m confident in the actions we are taking to
navigate the current uncertainty while continuing to build toward
the future.”
Ford has regularly described targets of having $20 billion in
cash and $30 billion in liquidity heading into an economic
downturn. At the end of 2019, those levels were $22 billion and $35
billion, respectively.
At the same time, Ford announced it has suspended the company’s
dividend, prioritizing near-term financial flexibility and
continued investments in an ambitious series of new-product
launches in 2020 and long-term growth initiatives.
Also, Ford said it is withdrawing the guidance it gave on Feb. 4
for 2020 financial performance, which did not factor in effects of
the coronavirus, given uncertainties in the business environment.
The company will provide an update on the year when it announces
first-quarter results, which is currently scheduled for April
28.
Ford this week announced plans to temporarily stop production at
its plants in North America and Europe starting today. The actions
were taken to protect the health and safety of employees and
respond to issues with the supply chain and other constraints. The
company will work with labor representatives to safely and
effectively restart production in the weeks to come.
Hackett noted China was the first country to face the virus and
is now emerging from the coronavirus crisis and showing
improvements in automobile demand. This news on the China recovery
should be a source of optimism about the overall economic recovery
as the virus abates, he said.
‘Built to Lend a Hand’ Program Provides Peace of Mind With Up
To Six Months of Payment Relief
Separately, Ford and its U.S. dealers are offering customers who
are dealing with their own peripheral challenges from the
coronavirus a variety of services, including six months of payment
relief for new-car buyers under the new “Built to Lend a Hand”
program.
Under the new program, developed with its dealers, Ford is
offering six months of payment relief for eligible new-car
customers who finance their purchases through Ford Credit. Ford
will pay for three months and customers can defer for up to three
more for a total of six months. The program is for people
purchasing 2019 and 2020 model-year vehicles, excluding 2020 Super
Duty trucks.
“Our dealers are incredibly connected to their communities,”
said Kumar Galhotra, president, Ford North America. “And they’re
willing to lend a hand by doing whatever it takes to help our
customers in this time of need.”
More information about the “Built to Lend a Hand Program” is
available at Ford.com.
About Ford Motor Company
Ford Motor Company is a global company based in Dearborn,
Michigan. The company designs, manufactures, markets and services a
full line of Ford cars, trucks, SUVs, electrified vehicles and
Lincoln luxury vehicles, provides financial services through Ford
Motor Credit Company and is pursuing leadership positions in
electrification; mobility solutions, including self-driving
services; and connected services. Ford employs approximately
190,000 people worldwide. For more information regarding Ford, its
products and Ford Motor Credit Company, please visit
www.corporate.ford.com.
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version on businesswire.com: https://www.businesswire.com/news/home/20200319005396/en/
Media: T.R. Reid 1.313.319.6683
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Shareholder Inquiries:
1.800.555.5259 or 1.313.845.8540 stockinf@ford.com
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