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Moody's downgrades Ford
Moody's Investors Service said it lowered Ford Motor Co.'s corporate family and long-term ratings to Ba3 from Ba1 and lowered Ford Motor Credit Co.'s long-term rating to Ba2 from Baa3 and short-term rating to Not Prime from Prime-3. Ford's SGL-1 speculative grade liquidity rating is affirmed.
The outlook is negative.
These rating actions conclude a review for possible downgrade that began on Nov. 22.
The downgrade reflects Moody's view that the company's financial and competitive position will remain under considerable stress through 2007 despite the potential longer-term benefits that may result from its pending restructuring initiatives.
The agency said that Ford's performance is likely to result in the company's risk profile remaining at the lower end of the 16-company automotive peer group rated by Moody's. Moreover, as Ford attempts to re-establish and strengthen its position, Moody's said it believes that leading Asian and European rivals will continue to make notable progress, thereby further increasing the competitive and operating challenges faced by Ford.
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