Ford suspends dividend and takes other coronavirus steps | Automotive Industry News

“Like we did in the Terrific Recession, Ford is managing through the coronavirus disaster in a way that safeguards our small business, our workforce, our buyers and our sellers through this critical time period” – CEO Jim Hackett

Ford reported on Thursday (19 March) it had extra US$fifteen.4bn of extra hard cash to its balance sheet, drawing from two credit lines, suspended its dividend to preserve hard cash and give extra flexibility, withdrawn direction for its 2020 money success and introduced a a few month payment deferral for suitable US new car buyers with a few much more compensated by for up to 6 months of payment ‘peace of mind’.

The automaker reported in a statement the initiatives would further more bolster its hard cash posture amid the coronavirus health and fitness disaster, sustain strategic flexibility, and established up the manufacturer to individual by itself from rivals when the global economic climate emerges from the latest time period of acute uncertainty.

“Like we did in the Terrific Recession, Ford is managing through the coronavirus disaster in a way that safeguards our small business, our workforce, our buyers and our sellers through this critical time period,” reported CEO Jim Hackett.

“As America’s greatest producer of vehicles and greatest employer of autoworkers, we system to arise from this disaster as a more powerful company that can be an motor for the recovery of the economic climate moving ahead.”

The company these days advised loan providers it would borrow the whole unused amounts against two lines of credit: $13.4bn less than its company credit facility and $2bn less than its supplemental credit facility.

The incremental hard cash from these borrowings will be applied to offset the non permanent operating cash impacts of the coronavirus relevant manufacturing shut downs and to preserve money flexibility.

“Though we definitely didn’t foresee the coronavirus pandemic, we have managed a strong balance sheet and enough liquidity so that we could weather economic uncertainty and go on to commit in our long run,” Hackett reported.

Ford has routinely described targets of getting $20bn in hard cash and $30bn in liquidity heading into an economic downturn. At the end of 2019, those people levels were being $22bn and $35bn, respectively.

It has suspended the dividend to prioritise around time period money flexibility and continued investments in new product or service launches in 2020 moreover extended time period growth initiatives.

Ford also reported it was withdrawing the direction it gave on four February for 2020 money performance, which did not variable in consequences of the coronavirus, given uncertainties in the small business surroundings.

The company will give an update on the 12 months when it announces 1st quarter success at the moment scheduled for 28 April.

Ford this 7 days announced designs to quickly end manufacturing at its crops in North America and Europe setting up these days. The steps were being taken to shield the health and fitness and basic safety of personnel and answer to troubles with the supply chain and other constraints. The company reported it would perform with labour associates to safely and securely and correctly restart manufacturing in coming weeks.

Hackett mentioned China was the 1st place to encounter the virus and was now rising from the disaster and showing improvements in automobile desire.

This information on the China recovery need to be a resource of optimism about the overall economic recovery as the virus abates, he reported.

Separately, Ford and its US dealers are giving buyers who are dealing with their possess peripheral challenges from the coronavirus a wide variety of companies, like 6 months of payment aid for new car consumers less than the new Developed to Lend a Hand programme.