The Morning Shift All your daily car news in one convenient place. Isn’t your time more important? Ford is still struggling, California will meet with the Trump administration, a and a former UAW official gets prison. All of that and more in The Morning Shift for Friday, Nov. 8, 2018. 1st Gear: Ford Might Be Junk Again Ford is still a hugely profitable company, despite Trump’s metals tariffs (which cost them $1 billion) and an $11 billion investment into its future. That future features no sedans except for the Mustang, and isn’t bleak for the company so much as highly uncertain. Which partially explains why Ford’s debt is now rated just above junk status, though, according to Bloomberg, it might be getting worse. Junk debt is the kind of debt that investors buy fully knowing it might never be fully paid back. The ratings also affect how much interest the company pays on its debt, which totals $150 billion. From Bloomberg: Bob Shanks, Ford’s chief financial officer, said on an earnings call last month that the company is committed to maintaining its investment-grade ratings, and doesn’t intend to lose that status again. The company is “moving with a sense of urgency and taking proactive steps to redesign and restructure the business,” and over time “the market will recognize our progress,” spokesman Brad Carroll said. But debt investors are skeptical. The extra yield that money managers get for holding Ford’s 4.346 percent bonds due 2026 rather than similar Treasuries jumped to… [Read full story]
Jalopnik is a news and opinion website about cars, the automotive industry, racing, transportation, airplanes, technology, motorcycles and much more. We aim to cover these things with an honesty, transparency and cheerful belligerence that can’t be found anywhere else.