What Is Changing For Ford Motor Company (NYSE:F)?


Ford Motor Company (NYSE:F) might be pushing its way out of a money market jam that commenced in the last recession as few investors offered short-term loans to company. The loans are in the type of commercial paper presented by money-market FII, which has amassed debt of $148 million in recent months. Federated stated that auto loans are usually the second top priority for customers behind mortgages, turning them attractive investments.

The details

The Federated investment is miniscule, but it indicates a prospective end to the money-market lockout on automobile manufacturers with the last recession. Investment in Ford Motor could encourage investment in Fiat Chrysler Automobiles NV (NYSE:FCAU) and General Motors Company (NYSE:GM), which have even struggled.

Commercial paper is stated a cheap form of borrowing as issuers generally boast high credit ratings and shareholders loan their funds over short periods. In May, Fitch Ratings upgraded rating of Ford to F2 from F3, placing it in the second-lowest stage of investment grade.

More recently, Ford reported U.S. vehicle sales in the last month came at around 228,000, down 5.1% from the comparable month in 2016. This single digit decline came in ahead of the 9.7% projection from Kelley Blue Book. For the year, the automaker has sold around 1.3 million vehicles which marks a 3.8% drop as compared to 2016.

These numbers are largely consistent when compared with metrics of overall auto industry which witnessed a 3% drop in June and a 2% drop thus far in 2017 as against 2016 US sales figures. This drop in sales is mainly due a slump in car sales partially offset by an increase in sales of SUVs and trucks. Overall, retail was steady from the same period of 2016 while fleet sales dropped around 14%.

In the last trading session, the stock price of Ford gained around 0.26% to close the day at $11.38.