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FORD TAKES ACTION TO ADDRESS EFFECTS OF CORONAVIRUS PANDEMIC

hybrid2bev

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FORD TAKES ACTION TO ADDRESS EFFECTS OF CORONAVIRUS PANDEMIC; COMPANY OFFERS NEW-CAR CUSTOMERS SIX-MONTH PAYMENT RELIEF
MAR 19, 2020 | DEARBORN, MICH.

  • $15.4 billion of additional cash on balance sheet, drawing from two credit lines
  • Dividend suspension to preserve cash and provide additional flexibility in the current environment
  • Withdrawal of company guidance for 2020 financial performance
  • Three month payment deferral for eligible U.S. new-car customers, plus three more paid by Ford, for up to six months of payment peace of mind
DEARBORN, Mich., March 19, 2020 – Ford Motor Company is taking a series of initiatives to further bolster the company’s cash position amid the coronavirus health crisis, maintain strategic flexibility on behalf of its team and customers, and set up Ford to separate itself from competitors when the global economy emerges from the current period of acute uncertainty.

“Like we did in the Great Recession, Ford is managing through the coronavirus crisis in a way that safeguards our business, our workforce, our customers and our dealers during this vital period,” said Ford CEO Jim Hackett. “As America’s largest producer of vehicles and largest employer of autoworkers, we plan to emerge from this crisis as a stronger company that can be an engine for the recovery of the economy moving forward.”
The company today notified lenders that it will borrow the total unused amounts against two lines of credit: $13.4 billion under its corporate credit facility and $2 billion under its supplemental credit facility. The incremental cash from these borrowings will be used to offset the temporary working capital impacts of the coronavirus-related production shut downs and to preserve Ford’s financial flexibility.

“While we obviously didn’t foresee the coronavirus pandemic, we have maintained a strong balance sheet and ample liquidity so that we could weather economic uncertainty and continue to invest in our future,” Hackett said. “Our Ford people are extremely resilient and motivated, and I’m confident in the actions we are taking to navigate the current uncertainty while continuing to build toward the future.”
Ford has regularly described targets of having $20 billion in cash and $30 billion in liquidity heading into an economic downturn. At the end of 2019, those levels were $22 billion and $35 billion, respectively.

At the same time, Ford announced it has suspended the company’s dividend, prioritizing near-term financial flexibility and continued investments in an ambitious series of new-product launches in 2020 and long-term growth initiatives.

Also, Ford said it is withdrawing the guidance it gave on Feb. 4 for 2020 financial performance, which did not factor in effects of the coronavirus, given uncertainties in the business environment. The company will provide an update on the year when it announces first-quarter results, which is currently scheduled for April 28.

Ford this week announced plans to temporarily stop production at its plants in North America and Europe starting today. The actions were taken to protect the health and safety of employees and respond to issues with the supply chain and other constraints. The company will work with labor representatives to safely and effectively restart production in the weeks to come.

Hackett noted China was the first country to face the virus and is now emerging from the coronavirus crisis and showing improvements in automobile demand. This news on the China recovery should be a source of optimism about the overall economic recovery as the virus abates, he said.

‘Built to Lend a Hand’ Program Provides Peace of Mind With Up To Six Months of Payment Relief
Separately, Ford and its U.S. dealers are offering customers who are dealing with their own peripheral challenges from the coronavirus a variety of services, including six months of payment relief for new-car buyers under the new “Built to Lend a Hand” program.
Under the new program, developed with its dealers, Ford is offering six months of payment relief for eligible new-car customers who finance their purchases through Ford Credit. Ford will pay for three months and customers can defer for up to three more for a total of six months. The program is for people purchasing 2019 and 2020 model-year vehicles, excluding 2020 Super Duty trucks.

“Our dealers are incredibly connected to their communities,” said Kumar Galhotra, president, Ford North America. “And they’re willing to lend a hand by doing whatever it takes to help our customers in this time of need.”
More information about the “Built to Lend a Hand Program” is available at Ford.com.



https://media.ford.com/content/ford...-address-effects-of-coronavirus-pandemic.html
 

Petter

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Coverage from Automotive News here.
 
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hybrid2bev

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During our town hall today there was a statement about new product launches. These include the Bronco, F-150 and Mach-E. Rest assured there is a focus on prioritizing the launches to minimize any delay.

I want to get my Mach-E just as soon as possible, just like the rest of you I'm sure.
 

dbsb3233

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During our town hall today there was a statement about new product launches. These include the Bronco, F-150 and Mach-E. Rest assured there is a focus on prioritizing the launches to minimize any delay.

I want to get my Mach-E just as soon as possible, just like the rest of you I'm sure.
I think that makes sense too, as the market for the Mach-e (being sort of a niche vehicle for Ford with a more dedicated base of customers waiting for it) will probably hold firmer than for their other vehicles.

But having said that, I expect the market for ALL new vehicles (and all manufacturers) to soften dramatically this year. Just less so for the Mach-e.
 

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I think that makes sense too, as the market for the Mach-e (being sort of a niche vehicle for Ford with a more dedicated base of customers waiting for it) will probably hold firmer than for their other vehicles.

But having said that, I expect the market for ALL new vehicles (and all manufacturers) to soften dramatically this year. Just less so for the Mach-e.
Beyond being a niche vehicle, why do you think Mach E sales will hold firm? My guess is they will soften. Several reasons: price of oil has dropped significantly, so ICE vehicle makes more economic sense; stock market drop leaving people feeling ‘less flush’ for a stretch purchase; optics of buying a prestige vehicle during a time of economic uncertainty or downright pain. Overall, I think most EV true believers are already driving Teslas, Leafs, or Bolts. Mach E, to me, is among the first true bridge offerings to the next level of early adopters.

As always, we shall see ...
 

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Beyond being a niche vehicle, why do you think Mach E sales will hold firm? My guess is they will soften. Several reasons: price of oil has dropped significantly, so ICE vehicle makes more economic sense; stock market drop leaving people feeling ‘less flush’ for a stretch purchase; optics of buying a prestige vehicle during a time of economic uncertainty or downright pain. Overall, I think most EV true believers are already driving Teslas, Leafs, or Bolts. Mach E, to me, is among the first true bridge offerings to the next level of early adopters.

As always, we shall see ...
Good point about oil prices (and the super cheap gas prices that will result). I've noted that too in other posts. As well as BEVs being about 10 grand more than their ICE counterparts. I definitely expect demand to drop.

But at the same time, there's only 50,000 Mach-e's being made for the first model year. And supposedly only around 15,000-20,000 going to US customers. That's a pretty small number for a unique (for Ford) primo vehicle with a lot of buzz and a list of people that are waiting in line with a $500 deposit. I think those volumes are small enough and the interest strong enough to where that will hold up better than the average Ford vehicle.
 

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I think for many of us in the Mach-E buyers pool, gas prices are sort of a secondary consideration. Like, it's a factor in putting the car over the top of fossil contenders, but the mental decision has already been made to go electric and it's just a matter of finding the right car that fits.

If this is a short term economic bump and I'm feeling more confident about everything by delivery time late this year, then I'll take delivery. If it's delayed, I'm stressing about money and 800V architectures are just around the corner, then I'll hold off.

Ford offering stupid finance terms would really help sell the car to me too so the news about 3 months of payments is nice and has me drooling about this fall/winter if it's still in play.
 

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The price of fuel in Europe is mainly tax of some sort or another so I’m not expecting a bit drop in view of the oil price. I think the stock market crash is going to have a much greater impact on peoples’ buying decisions.

It’s too early to assess the affect of Covid-19 yet as it hasn’t got anywhere near its peak infection rate in North America. However, I’ll be amazed if there any Mach-E deliveries in 2020.
 

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Beyond being a niche vehicle, why do you think Mach E sales will hold firm? My guess is they will soften. Several reasons: price of oil has dropped significantly, so ICE vehicle makes more economic sense; stock market drop leaving people feeling ‘less flush’ for a stretch purchase; optics of buying a prestige vehicle during a time of economic uncertainty or downright pain. Overall, I think most EV true believers are already driving Teslas, Leafs, or Bolts. Mach E, to me, is among the first true bridge offerings to the next level of early adopters.

As always, we shall see ...
Optics? I would think that is pretty low on the decision tree, at least it would be for me. Why would I care what car my neighbor is buying? Great for my neighbor to get a new car and to support the workers building it, especially in what could be a down economy (hopefully that is as bad as it gets!). If my neighbor can buy two, do it!
 
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FORD IN BRITAIN CORONAVIRUS UPDATE
MAR 20, 2020 | DUNTON, ESSEX

Ford is working closely with all our partners as we navigate through the current Coronavirus effects across the globe and our business operations. Due to the dramatic impact this ongoing crisis is having on the European market and the supplier industry, we have decided to bring forward part of the summer shutdown period for our UK operations to the Easter period.
This means production at Dagenham Engine Plant in east London will temporarily cease from Monday, March 23. Bridgend Engine Plant in South Wales will temporarily cease production from the end of the day on Wednesday, March 25. In addition, the shutdown period will also be extended across the rest of the Ford business in the UK, excluding a small number of employees supporting business critical activities.
During this four-week period, all our employees will receive payments at least equivalent to their base pay.


https://media.ford.com/content/ford...03/20/ford-in-britain-coronavirus-update.html
 

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Optics? I would think that is pretty low on the decision tree, at least it would be for me. Why would I care what car my neighbor is buying? Great for my neighbor to get a new car and to support the workers building it, especially in what could be a down economy (hopefully that is as bad as it gets!). If my neighbor can buy two, do it!
I’d agree optics are a low consideration. But still, I’d feel like a bit of a heel to roll up to a family picnic in a $55k vehicle when my cousins and others have been out of work and are struggling. But maybe that’s my Midwestern roots showing through, lol.
 

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I’d agree optics are a low consideration. But still, I’d feel like a bit of a heel to roll up to a family picnic in a $55k vehicle when my cousins and others have been out of work and are struggling. But maybe that’s my Midwestern roots showing through, lol.
Maybe the Fusion is better when visiting the cousins...👍;)
 

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During our town hall today there was a statement about new product launches. These include the Bronco, F-150 and Mach-E. Rest assured there is a focus on prioritizing the launches to minimize any delay.

I want to get my Mach-E just as soon as possible, just like the rest of you I'm sure.
Honestly, a delay of a few months to get a new car isn't really that big of a deal. The much larger concern is the economy in general; being in the midst of a deep recession hurts everyone. Hopefully that doesn't happen, and things recover by next year.
 



 









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