Ford raises 15.4 bln dollars in response to COVID-19, fully protects operations

It is reported that Ford Motor announced that it will take a series of positive measures to further ensure the stability of the company's cash flow to cope with the impact of the COVID-19, while maintaining the strategic flexibility of the business. The automaker will raise 15.4 billion dollars to offset the temporary working capital impact of production suspensions due to the outbreak.

15.4 billion is Ford's activation of two unused credit lines, including 13.4 billion under the Ford Motor Company credit line and 2 billion under the Ford Motor credit line.

It is reported that Ford's routine goal is to maintain 20 billion in cash and 30 billion in liquidity in response to any possible recession. As of the end of 2019, Ford had 22 billion in cash and 35 billion in liquidity on its books.

In addition, Ford also announced a moratorium on dividends to maintain short-term financial flexibility, and will continue to make some necessary investments to ensure the listing of a series of new models to be released in 2020 and the company's long-term business plan is not affected.

The automaker also stated that given the current uncertainties in the overall economy and the sudden impact of pandemic on the business, the company decided to withdraw the 2020 financial performance targets announced on February 4 and will re-issue updated business targets when first quarter results are announced on April 28.

Jim Hackett, President and CEO of Ford Motor Company, said: "The outbreak of the New Crown virus was unexpected, but Ford has always maintained a strong balance sheet and sufficient liquidity so that we can survive the economic crisis and to ensure investment in future business. "

Ford also announced this week plans to temporarily suspend production at its plants in North America and Europe. These initiatives by Ford are aimed at better protecting employees' health and safety, as well as addressing issues caused by the supply chain and other adverse factors. Ford will also work with labor representatives to resume production safely and effectively in the coming weeks.