Moody's ratings agency threatens to downgrade Ford Motor

Moody's Investors Service said Tuesday it is reviewing the credit rating of Ford Motor Co. for possible downgrade, deeper into junk status.

Moody's said it is reviewing Ford's Ba3 rating and the Ba2 rating of Ford Motor Credit Co. because of concern that high fuel prices will shift consumer preferences away from medium and large sport utility vehicles. Those ratings are three and two steps below investment grade, respectively.

"This erosion in a segment that had been highly profitable for Ford, could result in earnings and cash generation that are well below the rating agency's expectations and the financial objectives that underlie Ford's Way Forward recovery plan," Moody's said.

The ratings agency said its review of Ford Credit's rating was based on the financing company's connections to its parent.

Moody's announcement follows a similar one late last month by Standard & Poor's Ratings Services, which said it was putting Ford on review because of concern about declining North American market share and rising costs.

Ford shares fell 8 cents to $6.87 in afternoon trading Tuesday on the New York Stock Exchange, reports AP.

O.Ch.

Subscribe to Pravda.Ru Telegram channel, Facebook, Twitter, YouTube, RSS!

Author`s name: Editorial Team