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Ford Unit's Debt Rating Cut to Junk
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Auto on Info December 2003 Former Ford Unit's Debt Rating Cut to Junk Visteon Corporation, spun off by Ford in 2000, had its senior unsecured debt rating cut by Standard & Poor's and Moody's Investors Service to junk, on December 22nd and December 23rd, respectively, per a December 23rd Reuters article. Visteon, Ford's primary parts supplier, has had small success in finding new customers since the spinoff and relies on Ford, which is ultimately responsible for much of Visteon's employee retirement liabilities, for 80% of its sales. Ford has agreed to take back as many of the 20,000 UAW workers for which it is responsible as circumstances permit. It will also pump $100,000,000 into Visteon for a new computer system. In November 2003, Ford complained about its own debt rating cut to one notch above junk and argued that it didn't deserve it. Sources: Reuters, "Update - Moody's Cuts Visteon's Debt Ratings to Junk," December 23, 2003, and Reuters, "Ford Revamps Visteon Deals, Takes Charge," December 22, 2003. |
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