Fitch affirms Ford, entities at BBB+

Fitch Ratings said it affirmed the senior debt ratings of Ford Motor Co., Ford Motor Credit Co. Hertz Corp. and their respective subsidiaries at BBB+ and commercial paper at F2. The outlook for all entities remains negative.

This affirmation reflects Ford's very high level of liquidity, offset by relentless competitive pressures which continue to affect pricing and margins. Recent factors include progress to date under the company's cost reduction plan, the settlement with the United Automobile Workers and the launch of the new F-150 truck.

Over the near term, Fitch's concerns center on the ability of Ford to enhance North American margins and cash flow, the restoration of profitability at its European operations, Ford's current and future pension/healthcare obligations, and the affect of any potential disruptions in funding capability at Ford Motor Credit.

The ratings for Ford remain strongly influenced by the company's liquidity position, with Ford Motor having almost $27 billion of cash on hand against about $20 billion of debt outstanding, with an average maturity of 26 years.

At Ford Motor Credit the position is similarly strong with $20 billion of cash on hand. Ford Motor Credit's balance sheet is strongly positioned over the next several years, with assets rolling off more quickly than the debt, resulting in the ability to continue to shrink the balance sheet should current operating trends change.

Beyond gross cash on hand, Ford also has access to additional committed credit facilities in excess of $40 billion.

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