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GM & Ford are Junk, And I'm not talkin about their

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  • GM & Ford are Junk, And I'm not talkin about their

    GM, Ford Motor Debt Ratings Cut to Junk by Moody's

    General Motors Corp. and Ford Motor Co., the two biggest U.S. automakers, were lowered to junk by Moody's Investors Service.

    Moody's lowered General Motors Corp.'s rating two levels to Ba2 and the rating on its finance arm to Ba1. Dearborn, Michigan-based Ford was cut one level to Ba1, one step below investment grade. Moody's also reduced its rating on Ford Motor Credit Co. to the lowest investment grade. The Ford cuts affect about $150 billion in debt, Moody's said in a statement today.

    It's the second junk rating for Ford after Standard & Poor's lowered the company to non-investment grade on May 5. That will push the automaker out of the most widely followed investment-grade bond index by Lehman Brothers Holdings Inc. and may spark selling of the bonds.

    Chief Executive William Clay Ford Jr., 48, saw his company's share of the U.S. auto market fall for 28 straight months through June. In July, sales rose 29 percent after the company offered employee-pricing discounts to all consumers.

    Ford faces ``continued challenges in addressing its uncompetitive cost structure in North America,'' Moody's said. Ford's North American operations have lost money three of the past four quarters.

    Ford Chief Financial Officer Don Leclair said in a statement today that the downgrade ``is disappointing.'' He said the action ``doesn't shake our determination to achieve continued success as a global automaker. We recognize many of the challenges Moody's cited and remain committed to accelerating our business plan.''
    At first glance it looks like Ford and GM are signaling they're going to go belly-up unless they move production overseas...but I think what they're really saying is they're going to go belly-up and avoid paying pensions and benefits to thousands of active and retired workers.

    Compassionate capitalism.

    In any event, I wouldn't pay much attention to this story. The real danger is Hugo Chavez. We must ice that fucker for jesus and the american way.

  • #2
    From what I've heard, they're going to have to cut pensions. They're just paying out way too much. The people that have worked there forever are going to be screwed.

    I've heard where some that are retired from an auto union, have had healthcare cut for retired workers.

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    • #3
      Being that I work for GM in an assembly plant in Detroit, it its not as bad as the papers make it out to be. Yes we have a huge pension & Health care bill, yes more prople are bying foreign cars, Yes GM & Ford have had their head up their asses for a while. If you look at the most recent J.D. Powers #'s GM did quite well. All we need to do now is price cars & trucks were people will buy them with asking what the deal will be tomorrow.

      ** Official Lounge sponsor of Fulham and Detroit Lions**

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      • #4
        "Our trucks have the tightest turning radius!"

        Moon

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