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Moody's lowers Ford, Ford Motor Credit
Moody's Investors Service said it lowered the ratings of Ford Motor Co., including the senior unsecured rating to Ba1 from Baa3, and assigned a Ba1 corporate family rating and an SGL-1 speculative grade liquidity rating.
Moody's also lowered Ford Motor Credit Co.'s senior unsecured rating to Baa3 from Baa2 and short-term rating to Prime-3 from Prime-2.
The outlook for both companies is negative.
Moody's said the downgrades reflect further erosion in the operating results and cash flow generation of Ford in consideration of weakened market share and continued challenges in addressing its uncompetitive cost structure in North America. These factors are expected to result in a pretax loss from automotive operations for 2005.
Since improvement in the company's cost structure can only be implemented over a period of time, financial performance is expected to remain weak.
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