Ford 2007 Annual Report Download - page 36

Management’s Discussion and Analysis of Financial Condition and Results of Operations
34 Ford Motor Company | 2007 Annual Report
Credit Ratings. Our short- and long-term debt is rated by four credit rating agencies designated as nationally
recognized statistical rating organizations ("NRSROs") by the SEC:
• Dominion Bond Rating Service Limited ("DBRS");
• Fitch, Inc. ("Fitch");
• Moody’s Investors Service, Inc. ("Moody’s"); and
• Standard & Poor’s Rating Services, a division of The McGraw-Hill Companies, Inc. ("S&P").
In several markets, locally recognized rating agencies also rate us. A credit rating reflects an assessment by the rating
agency of the credit risk associated with a corporate entity or particular securities issued by that entity. Their ratings of us
are based on information provided by us and other sources. Credit ratings are not recommendations to buy, sell or hold
securities and are subject to revision or withdrawal at any time by the assigning rating agency. Each rating agency may
have different criteria for evaluating company risk and, therefore, ratings should be evaluated independently for each
rating agency. Lower credit ratings generally result in higher borrowing costs and reduced access to capital markets. The
NRSROs have indicated that our lower ratings are primarily a reflection of the rating agencies' concerns regarding our
automotive cash flow and profitability, declining market share and product portfolio strength, excess industry capacity and
industry pricing pressure.
The following ratings actions were taken in the fourth quarter 2007:
Ford
• DBRS: In November 2007, DBRS changed Ford's trend to "Stable" from "Negative."
• Fitch: No ratings actions taken in Q4 2007.
• Moody's: In November 2007, Moody's changed Ford's outlook to "Stable" from "Negative."
• S&P: In November 2007, S&P changed Ford's outlook to "Stable" from "Negative."
Ford Credit
• DBRS: In November 2007, DBRS changed Ford Credit's trend to "Stable" from "Negative."
• Fitch: No ratings actions taken in Q4 2007.
• Moody's: In November 2007, Moody's changed Ford Credit's outlook to "Stable" from "Negative."
• S&P: In November 2007, S&P changed Ford Credit's outlook to "Stable" from "Negative."
The following summarizes certain of the credit ratings and the outlook presently assigned to Ford and Ford Credit by
these four NRSROs:
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__________
* The SEC recognized Rating and Investment Information, Inc. ("R&I") and Japan Credit Rating Agency, Ltd. ("JCR") as NRSROs in May 2007 and
September 2007 respectively. Both agencies assign long-term issue ratings to Ford Credit's February 2005 ¥160 billion 1.71% issuance which
matures in February 2008. R&I assigns a rating of BB- with a negative outlook and JCR assigns a rating of B+ with a negative outlook.
** S&P rates FCE's long-term senior unsecured rating as B+, maintaining a one notch differential versus Ford Credit.