Obbligazioni societarie GM, Ford, Chrysler: il 3D dell'automotive USA (2 lettori)
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paologorgo
Chapter 11
non vorrei perdere il lettore più affezionato del nostro forum (Shark... 
) e gli passo un assist:
Oral Testimony by Walter Borst, GM Treasurer to the Congressional Oversight Panel on Federal Government Assistance to the Auto Industry
Good morning, Chairwoman Warren and distinguished members of the Oversight Panel.
Thank you for the opportunity to testify about how GM is reinventing our company and how a new GM will repay our nation’s investment.
Emerging from bankruptcy, we are a new company with less debt, a stronger balance sheet, with the right-sized manufacturing, product and dealer network to match today’s market realities. GM can now direct its full energy and resources to where it should be: on customers, cars and a culture to succeed.
We are grateful for our nation’s support. Without it, we would not have this second chance. Equally important, are the many who have been called to sacrifice in order to create a new GM .
We recognize the unprecedented level of government support and the pain caused by the bankruptcy process. For this reason, both the Obama and Bush Administrations made it quite clear that they were reluctant investors. We were equally reluctant recipients. I can assure you as GM Corporate Treasurer that we pursued every possible alternative to raise funding and liquidity for General Motors and every possible alternative to restructure the GM balance sheet out of court.
However, a government-funded chapter 11 bankruptcy was the last, best option to avoid the devastating economic consequences to our country if GM collapsed.
Although GM was out of time and money, to protect the taxpayers’ interests, we had to deliver a plan to ensure we would never find ourselves in this position again. The direction we received from the President’s Automotive Task was clear and to the point. To receive government funding and remain viable, GM had to complete a dramatic, fast restructuring, across all parts of our business. We agreed.
Over the last several months, we worked closely with the Task Force to revise our operating plan and indentify and agree to the broad targets and overall components needed to create a viable GM. The Automotive Task Force did not tell us how to run or business or dictate the specific details of our plan. Rather, they exercised the due diligence as any purchaser of a business would. They questioned us and challenged us to ensure that we had a robust and viable plan for GM.
Created from the old GM’s strongest operations, in an asset sale approved by the U.S. bankruptcy court, the new GM will:
In closing, as Fritz Henderson, our President and CEO has indicated, business as usual at GM is over. The last 100 days or so has shown everyone – including ourselves – that a company not known for quick action can, in fact, move very fast.
We want to take the intensity, the decisiveeness and the speed of these last few weeks and transfer it to the day-to-day operation of the new company. This will be the new norm at General Motors.
We must be accountable to perform and deliver winning results. Again from this point on, our efforts are dedicated to customers, cars, culture, and paying back the taxpayers--both the loans and in creating real value for shareholders.
Through the taxpayers’ support and the sacrifice of many, GM will be great once again. We owe it to them to go forward with our new company as we constructed it. We owe it to them to succeed.
Thank you very much and I look forward to answering your questions.
) e gli passo un assist: Oral Testimony by Walter Borst, GM Treasurer to the Congressional Oversight Panel on Federal Government Assistance to the Auto Industry
Field Hearing at Wayne State University, Detroit, Mich.
Good morning, Chairwoman Warren and distinguished members of the Oversight Panel.
Thank you for the opportunity to testify about how GM is reinventing our company and how a new GM will repay our nation’s investment.
Emerging from bankruptcy, we are a new company with less debt, a stronger balance sheet, with the right-sized manufacturing, product and dealer network to match today’s market realities. GM can now direct its full energy and resources to where it should be: on customers, cars and a culture to succeed.
We are grateful for our nation’s support. Without it, we would not have this second chance. Equally important, are the many who have been called to sacrifice in order to create a new GM .
We recognize the unprecedented level of government support and the pain caused by the bankruptcy process. For this reason, both the Obama and Bush Administrations made it quite clear that they were reluctant investors. We were equally reluctant recipients. I can assure you as GM Corporate Treasurer that we pursued every possible alternative to raise funding and liquidity for General Motors and every possible alternative to restructure the GM balance sheet out of court.
However, a government-funded chapter 11 bankruptcy was the last, best option to avoid the devastating economic consequences to our country if GM collapsed.
Although GM was out of time and money, to protect the taxpayers’ interests, we had to deliver a plan to ensure we would never find ourselves in this position again. The direction we received from the President’s Automotive Task was clear and to the point. To receive government funding and remain viable, GM had to complete a dramatic, fast restructuring, across all parts of our business. We agreed.
Over the last several months, we worked closely with the Task Force to revise our operating plan and indentify and agree to the broad targets and overall components needed to create a viable GM. The Automotive Task Force did not tell us how to run or business or dictate the specific details of our plan. Rather, they exercised the due diligence as any purchaser of a business would. They questioned us and challenged us to ensure that we had a robust and viable plan for GM.
Created from the old GM’s strongest operations, in an asset sale approved by the U.S. bankruptcy court, the new GM will:
- Focus on four core brands in the U.S. - Chevrolet, Cadillac, Buick and GMC - with fewer nameplates and a more competitive level of marketing support per brand. By reducing brands and reducing nameplates to 34 from 48, we can concentrate all of our talent and resources on vehicles that do not merely compete, but lead their respective segments;
- Effectively close the competitive gap in active worker labor costs compared with transplant auto manufacturers;
- More efficiently utilize U.S. capacity, while increasing over time the percentage of U.S. sales manufactured domestically;
- Feature lower structural costs, enabling our North American region to break even (on an adjusted EBIT basis) at a U.S. total industry volume of approximately 10 million vehicles. This rate is substantially below the 15 to 17 million annual vehicle sales rates recorded from 1995 through 2007;
- Achieve lower structural costs in part by further reducing 2009 salaried employment in North America from its year-end total of 35,100 to approximately 27,200, cutting executive ranks by 35% and continuing to improve GM’s balance sheet by reducing retiree benefits for salaried retirees and non-UAW hourly retirees;
- Provide a higher level of customer service through a more focused U.S. network of approximately 3,600 dealers;
- Continue and increase GM’s investment and leadership in fuel economy and advanced propulsion technologies. For example, GM will launch the Chevy Volt extended range electric vehicle in 2010 and will assemble its advanced batteries in the U.S. We also expect to have 14 hybrid models in production by 2012 and, by 2014, 65 percent of GM vehicles will be alternative fuel-capable.
In closing, as Fritz Henderson, our President and CEO has indicated, business as usual at GM is over. The last 100 days or so has shown everyone – including ourselves – that a company not known for quick action can, in fact, move very fast.
We want to take the intensity, the decisiveeness and the speed of these last few weeks and transfer it to the day-to-day operation of the new company. This will be the new norm at General Motors.
We must be accountable to perform and deliver winning results. Again from this point on, our efforts are dedicated to customers, cars, culture, and paying back the taxpayers--both the loans and in creating real value for shareholders.
Through the taxpayers’ support and the sacrifice of many, GM will be great once again. We owe it to them to go forward with our new company as we constructed it. We owe it to them to succeed.
Thank you very much and I look forward to answering your questions.
paologorgo
Chapter 11
General Motors (GM) issued the following statement regarding the Delphi auction: “On June 16, 2009, Judge Robert Drain of the U.S. Bankruptcy Court for the Southern District of New York entered an order directing the process through which Delphi would consider bids for the company in addition to the bid from Platinum Equity. GM fully supported a competitive bidding process as provided for in the court order. At the conclusion of the bidding at the auction on July 27, the proposal from the Debtor in Possession (DIP) lenders was deemed successful by Delphi and provided better economics to GM than that from Platinum Equity. GM supports this bid, which is still subject to Delphi bankruptcy court approval, and we are pleased that Delphi is now positioned to move forward in its restructuring. A court hearing seeking approval of the bid is scheduled for July 29.”
paologorgo
Chapter 11
GM Plans a Return to Car Leasing
After Yearlong Hiatus, Funding by GMAC and Others Will Let Company Restore an Important Sales Tool
By JOHN D. STOLL
General Motors Co. and its financing affiliate GMAC Inc. are eyeing an Aug. 1 return to the auto-leasing market, according to people familiar with the matter, after massive government bailout packages allowed both companies to get back on their feet.
GM and Chrysler Group LLC pulled out of leasing in August 2008 amid a steady decline in vehicle resale values, a sales slump and troubles at their respective lending affiliates.
At the time, leasing represented about 20% of GM's new-car business in the U.S. and was causing losses for GM and other car makers.
Many of their key competitors, including Ford Motor Co., Daimler AG and Toyota Motor Corp., scaled back leasing but didn't pull out of the business completely.
In a recent conference call with analysts and reporters, GM said many of the company's former lease customers have decided to purchase vehicles instead from GM, or chose to buy a used car or defect to another auto maker.
GM, which filed for bankruptcy in June and emerged from court in early July, has said credit availability still remains a key drag on auto sales.
Details of GM's leasing plans are still being hammered out, but people familiar with the program said the company is looking at various models across its four-brand lineup as candidates for leasing. Those include the Cadillac CTS, which competes in a luxury market that is heavily dependent on the availability of lease deals.
GM spokesman Pete Ternes said the car maker has been studying ways to get back into leasing, but couldn't comment on the company's exact plans because they aren't finalized.
GMAC spokeswoman Gina Proia said her company "continues to evaluate ways to support" the auto industry with financing packages and "leasing is one of the options we are evaluating."
A GM executive working on the plans said the auto maker has talked with several banks as well to obtain financing for leasing. "Credit is easing, banks have capacity and [resale] values have been steadily increasing," the executive said.
After running into serious liquidity problems in late 2008, both GM and GMAC, a former subsidiary, have been propped up by more than $60 billion in government funds. GMAC's balance sheet was strengthened by $12 billion in federal capital in the second quarter alone.
GM sold 51% of GMAC in 2006 to Cerberus Capital Management LP, and was forced to give up an additional 40% of its stake after the December bailout of the lending firm. Currently, GM owns 9.9% of GMAC, which has become a bank holding company thanks to the bailout.
Despite GM's shrinking stake, the auto maker and GMAC remain contractually bound as preferred partners when it comes to new-vehicle financing. GMAC recently added Chrysler Group as a strategic partner following Chrysler's early-June emergence from bankruptcy protection. It is unclear when, or if, Chrysler will return to leasing.
Although GM dealers have been able to finance some buyers via lease programs through credit unions and other lenders over the last 12 months, those deals have represented a negligible part of its sales.
Historically, GM and GMAC were able to team up to offer cheap leases. GM would use marketing dollars, earmarked as vehicle incentives, to subsidize the cost of a vehicle lease that GMAC would originate and fund.
There are several factors behind GM's willingness to tiptoe back into offering new-vehicle leases at its dealerships, including the firming up of resale values for used cars and trucks.
When vehicle resales values, also known as rehsidual values, decline, the fundamentals underpinning the leaasing market are damaged because lease paymenrts are typically calculated on the assumed value of a car or truckk at the end of a lease contract.
If resale values are unstable, it becomes more difficult to run a profitable leasing business.
Write to John D. Stoll at [email protected]
After Yearlong Hiatus, Funding by GMAC and Others Will Let Company Restore an Important Sales Tool
By JOHN D. STOLL
General Motors Co. and its financing affiliate GMAC Inc. are eyeing an Aug. 1 return to the auto-leasing market, according to people familiar with the matter, after massive government bailout packages allowed both companies to get back on their feet.
GM and Chrysler Group LLC pulled out of leasing in August 2008 amid a steady decline in vehicle resale values, a sales slump and troubles at their respective lending affiliates.
At the time, leasing represented about 20% of GM's new-car business in the U.S. and was causing losses for GM and other car makers.
Many of their key competitors, including Ford Motor Co., Daimler AG and Toyota Motor Corp., scaled back leasing but didn't pull out of the business completely.
In a recent conference call with analysts and reporters, GM said many of the company's former lease customers have decided to purchase vehicles instead from GM, or chose to buy a used car or defect to another auto maker.
GM, which filed for bankruptcy in June and emerged from court in early July, has said credit availability still remains a key drag on auto sales.
Details of GM's leasing plans are still being hammered out, but people familiar with the program said the company is looking at various models across its four-brand lineup as candidates for leasing. Those include the Cadillac CTS, which competes in a luxury market that is heavily dependent on the availability of lease deals.
GM spokesman Pete Ternes said the car maker has been studying ways to get back into leasing, but couldn't comment on the company's exact plans because they aren't finalized.
GMAC spokeswoman Gina Proia said her company "continues to evaluate ways to support" the auto industry with financing packages and "leasing is one of the options we are evaluating."
A GM executive working on the plans said the auto maker has talked with several banks as well to obtain financing for leasing. "Credit is easing, banks have capacity and [resale] values have been steadily increasing," the executive said.
After running into serious liquidity problems in late 2008, both GM and GMAC, a former subsidiary, have been propped up by more than $60 billion in government funds. GMAC's balance sheet was strengthened by $12 billion in federal capital in the second quarter alone.
GM sold 51% of GMAC in 2006 to Cerberus Capital Management LP, and was forced to give up an additional 40% of its stake after the December bailout of the lending firm. Currently, GM owns 9.9% of GMAC, which has become a bank holding company thanks to the bailout.
Despite GM's shrinking stake, the auto maker and GMAC remain contractually bound as preferred partners when it comes to new-vehicle financing. GMAC recently added Chrysler Group as a strategic partner following Chrysler's early-June emergence from bankruptcy protection. It is unclear when, or if, Chrysler will return to leasing.
Although GM dealers have been able to finance some buyers via lease programs through credit unions and other lenders over the last 12 months, those deals have represented a negligible part of its sales.
Historically, GM and GMAC were able to team up to offer cheap leases. GM would use marketing dollars, earmarked as vehicle incentives, to subsidize the cost of a vehicle lease that GMAC would originate and fund.
There are several factors behind GM's willingness to tiptoe back into offering new-vehicle leases at its dealerships, including the firming up of resale values for used cars and trucks.
When vehicle resales values, also known as rehsidual values, decline, the fundamentals underpinning the leaasing market are damaged because lease paymenrts are typically calculated on the assumed value of a car or truckk at the end of a lease contract.
If resale values are unstable, it becomes more difficult to run a profitable leasing business.
Write to John D. Stoll at [email protected]
paologorgo
Chapter 11
Sources say GM refuses to back Magna's (MGA) offer to buy Opel, and would rather enter bankruptcy if it can't come to terms with the German government over a rival bid from RHJ International (RHJIF.PK).
paologorgo
Chapter 11
GM Creditors Sue JPMorgan, Claim $1.4 Billion Loan Unsecured
By Christopher Scinta
Aug. 1 (Bloomberg) -- The committee representing General Motors Corp.’s unsecured creditors sued JPMorgan Chase & Co. and dozens of other lenders, claiming a $1.4 billion loan they made to the automaker before it filed for bankruptcy was unsecured.
Lenders on the syndicated loan, which predated GM’s Chapter 11 filing on June 1, didn’t have a perfected lien on GM’s assets and so shouldn’t have had their claims paid ahead of other creditors, according to the complaint filed yesterday in U.S. Bankruptcy Court in New York.
The loan was paid off with funds from $33 billion in financing that GM received from the U.S. and Canadian governments during its reorganization. The creditors claim the security interest agreement on the loan was terminated in October 2008. JPMorgan said the suit seeks to take advantage of an action taken in error by one of GM’s law firms.
“The collateral for the loan was in place when GM filed” for bankruptcy, JPMorgan spokeswoman Kristin Lemkau said. “The lawsuit is without merit and we are confident that it will be dismissed.”
Old GM sold most of the automaker’s assets to a group led by the U.S. Treasury earlier last month and is liquidating the remainder in bankruptcy court. Detroit-based New GM, known as General Motors Co., continues to be funded by the U.S. and Canadian governments.
The case is In re Motor Liquidation Co. f/k/a General Motors Corp., 09-50026, U.S. Bankruptcy Court, Southern District of New York (Manhattan).
http://www.bloomberg.com/apps/news?pid=20601087&sid=awfutONf_3zs
By Christopher Scinta
Aug. 1 (Bloomberg) -- The committee representing General Motors Corp.’s unsecured creditors sued JPMorgan Chase & Co. and dozens of other lenders, claiming a $1.4 billion loan they made to the automaker before it filed for bankruptcy was unsecured.
Lenders on the syndicated loan, which predated GM’s Chapter 11 filing on June 1, didn’t have a perfected lien on GM’s assets and so shouldn’t have had their claims paid ahead of other creditors, according to the complaint filed yesterday in U.S. Bankruptcy Court in New York.
The loan was paid off with funds from $33 billion in financing that GM received from the U.S. and Canadian governments during its reorganization. The creditors claim the security interest agreement on the loan was terminated in October 2008. JPMorgan said the suit seeks to take advantage of an action taken in error by one of GM’s law firms.
“The collateral for the loan was in place when GM filed” for bankruptcy, JPMorgan spokeswoman Kristin Lemkau said. “The lawsuit is without merit and we are confident that it will be dismissed.”
Old GM sold most of the automaker’s assets to a group led by the U.S. Treasury earlier last month and is liquidating the remainder in bankruptcy court. Detroit-based New GM, known as General Motors Co., continues to be funded by the U.S. and Canadian governments.
The case is In re Motor Liquidation Co. f/k/a General Motors Corp., 09-50026, U.S. Bankruptcy Court, Southern District of New York (Manhattan).
http://www.bloomberg.com/apps/news?pid=20601087&sid=awfutONf_3zs
paologorgo
Chapter 11
Cash-for-clunkers program pushes auto sales into overdrive
Dealers face Web site glitches, questions about government funding
By Michael Oneal |Tribune reporter August 2, 2009 After a day and a half of confusion surrounding the government's surprisingly popular "cash for clunkers" program, at least two things came into relative focus on Friday.
First, the White House has promised that the trade-in incentive program will continue through the weekend. Second, the measure has spurred auto sales beyond anybody's wildest dreams.
What remains fuzzy about the clunkers program is just about everything else -- how it works, how it will be funded, whether inventories will last and whether an overtaxed government bureaucracy can find a way to manage it more effectively.
"I don't think anybody anticipated this kind of volume," said Marty Collins, an executive with Group 1 Automotive, which operates 99 auto dealer showrooms nationwide. "The system wasn't built to handle it."
That became apparent Thursday evening when government officials threatened to shut down the program, formally called the Car Allowance Rebate System, after it had burned through its $1 billion in funding in less than a week.
News that the program was ending abruptly sparked a tidal wave of traffic in the nation's auto showrooms. By early Friday, the U.S. House of Representatives had rushed through $2 billion in emergency funding for a program of sudden political import.
The Senate plans to take up the measure next week, though observers expect more of a debate in that chamber over the program's economic and environmental value.
In the meantime, White House spokesman Robert Gibbs sought to reassure consumers the program will continue through the weekend.
"If you meet the requirements ... the certificates will be honored," he said.
The car-buying program, which began seemingly as an afterthought in the Obama administration's economic rescue plan, was designed to spur auto sales and further environmental goals by offering consumers incentives to trade in certain late-model used cars for more fuel-efficient new cars.
Payments top out at $4,500, but deals are better than that because automakers also are offering incentives. Chrysler has been the most aggressive, dealers say. It is matching the government's incentives, meaning a Chrysler customer can get about $9,000 off a new Dodge Caliber.
The clunkers program started July 24, and sales built steadily following auto industry advertising. It went into overdrive Thursday night when the administration threatened to cut it off.
Car shoppers flooded dealerships hoping to get in under the wire. Jim Vertucci, sales manager of Joe Rizza Ford in Riverside, said his team sold more than two dozen cars after the news broke and stayed open until midnight to wrap up deals.
Rob Crane, co-owner of Chicago's Napleton Northwestern Chrysler Jeep Dodge, said he sold $2 million of inventory over the week and is now tapped out. "I've got nothing left," he said.
So far the program has paid about $150 million to car dealers and reserved as much as $850 million more for pending applications, according to congressional aides. That brought the total dangerously close to the plan's funding limit.
http://www.chicagotribune.com/business/chi-sat-clunkers-0801-aug02,0,19623.story
Dealers face Web site glitches, questions about government funding
By Michael Oneal |Tribune reporter August 2, 2009 After a day and a half of confusion surrounding the government's surprisingly popular "cash for clunkers" program, at least two things came into relative focus on Friday.
First, the White House has promised that the trade-in incentive program will continue through the weekend. Second, the measure has spurred auto sales beyond anybody's wildest dreams.
What remains fuzzy about the clunkers program is just about everything else -- how it works, how it will be funded, whether inventories will last and whether an overtaxed government bureaucracy can find a way to manage it more effectively.
"I don't think anybody anticipated this kind of volume," said Marty Collins, an executive with Group 1 Automotive, which operates 99 auto dealer showrooms nationwide. "The system wasn't built to handle it."
That became apparent Thursday evening when government officials threatened to shut down the program, formally called the Car Allowance Rebate System, after it had burned through its $1 billion in funding in less than a week.
News that the program was ending abruptly sparked a tidal wave of traffic in the nation's auto showrooms. By early Friday, the U.S. House of Representatives had rushed through $2 billion in emergency funding for a program of sudden political import.
The Senate plans to take up the measure next week, though observers expect more of a debate in that chamber over the program's economic and environmental value.
In the meantime, White House spokesman Robert Gibbs sought to reassure consumers the program will continue through the weekend.
"If you meet the requirements ... the certificates will be honored," he said.
The car-buying program, which began seemingly as an afterthought in the Obama administration's economic rescue plan, was designed to spur auto sales and further environmental goals by offering consumers incentives to trade in certain late-model used cars for more fuel-efficient new cars.
Payments top out at $4,500, but deals are better than that because automakers also are offering incentives. Chrysler has been the most aggressive, dealers say. It is matching the government's incentives, meaning a Chrysler customer can get about $9,000 off a new Dodge Caliber.
The clunkers program started July 24, and sales built steadily following auto industry advertising. It went into overdrive Thursday night when the administration threatened to cut it off.
Car shoppers flooded dealerships hoping to get in under the wire. Jim Vertucci, sales manager of Joe Rizza Ford in Riverside, said his team sold more than two dozen cars after the news broke and stayed open until midnight to wrap up deals.
Rob Crane, co-owner of Chicago's Napleton Northwestern Chrysler Jeep Dodge, said he sold $2 million of inventory over the week and is now tapped out. "I've got nothing left," he said.
So far the program has paid about $150 million to car dealers and reserved as much as $850 million more for pending applications, according to congressional aides. That brought the total dangerously close to the plan's funding limit.
http://www.chicagotribune.com/business/chi-sat-clunkers-0801-aug02,0,19623.story
Imark
Forumer storico
S&P gioca una tripla sull'andamento del rating Ford ina una rating action coincidente con il lancio di nuovi bond e in cui si dà prova di grandi doti di equilibrismo verbale... e sembra già decisamente ottimista rispetto a qualche mese fa, senza peraltro escludere nulla e tenendosi la porta aperta per un downgrade, dovessero le cose cessare di andare meno peggio...
Una rating action tutta da leggere fra le righe...
Vedremo come andrà... di sicuro interesse le stime di S&P sull'andamento del mercato USA nel 2009 e nel 2010 e di quelli europei nello stesso periodo.
[FONT=Arial, Helvetica, sans-serif]Ford Motor Co. Outlook Revised To Developing From Negative On Progress In Reducing Cash Use[/FONT]
NEW YORK (Standard & Poor's) July 27, 2009--Standard & Poor's Ratings Services today said it has revised its outlook on Ford Motor Co. and related entities to developing from negative. At the same time, we affirmed our ratings, including the 'CCC+' issuer credit ratings on Ford and Ford Motor Credit Co. LLC, as well as the 'B-' ratings on FCE Bank PLC, Ford Credit's European bank, maintaining the one-notch rating differential between FCE and its parent, Ford Credit.
"The outlook revision reflects early signs of progress by Ford in reducing cash use from its automotive operations and stabilizing, if not improving, its U.S. market share," said Standard & Poor's credit analyst Robert Schulz.
The company reported that it used $1.2 billion in cash, including cash restructuring costs and upfront subvention payments to Ford Credit, in its global automotive operations in the second quarter of 2009, much less than that used in the two previous quarters ($4.0 billion in the first quarter of 2009 and $7.4 billion in the fourth quarter of 2008).
In our view, there is now potential for us to raise Ford's ratings in the next year or so, although the possibility for a downgrade remains significant.
For example, we could consider raising the rating under the following scenario:
Also, we still believe that the very fragile state of the interrelated auto supply base poses some risks to Ford's liquidity.
The cash use is being caused by weak auto sales in almost every market, but especially in the U.S. and Europe. Our economists forecast U.S. light-vehicle sales of about 9.9 million units this year, the lowest in nearly 40 years and down 25% from the 13.2 million units sold in 2008.
We currently expect sales to rise to 11.2 million units in 2010, but even with this improvement, sales would still be 15% below the weak levels of 2008.
The outlook for other major auto markets, including Europe, will also remain bleak, in our view, until economic stabilization becomes apparent. We expect sales in Europe to be lower in 2010 than in 2009, in part because of a shifting of sales from various government scrappage incentives. Ford and other high-volume automakers in Europe have benefited from these incentive plans in 2009, but we believe the boost to sales will be short-lived.
We believe Ford still faces the possibility of falling below the necessary levels of cash to run its automotive business--but perhaps not in 2009, given the progress it has shown in the first half of this year. We
estimate that this could occur if cash use in its automotive operations, including restructuring charges, exceeded about $12 billion total in 2009 and 2010.
In our view, the most likely catalysts for cash use of this magnitude would be if auto sales remained unchanged or worsened in 2010 from already weak 2009 levels, or if another spike in gas prices caused renewed pressure on Ford's product mix, which is still heavily weighted toward light trucks despite the company's successful initial steps to enhance its small and midsize car offerings.
We believe fundamental business risks will remain unchanged well into 2010 at least, most notably the company's exposure to weak vehicle demand globally, but also the substantial execution risk of the company's ongoing restructuring and repositioning.
Items that Ford can address over time, such as its manufacturing overcapacity, labor costs, and product line-up, may not, in our view, be sufficient to produce any meaningful free cash flow in the immediate future, although a stabilization of industry sales, even at low levels, would lead to lower cash use in 2009. Ford stated that the relatively strong second-quarter cash performance may not continue in the third quarter.
Industry sales remain weak in nearly all of Ford's key sales regions. Consequently, we expect Ford's cash use to continue through the end of this year and perhaps into 2010; however, in our view, there is an increasing likelihood that cash use will be measurably lower than it was in 2008 as the company benefits from slashed costs and reduced outflows from working capital effects.
We believe Ford may avoid revisiting its informal request for $9 billion in loans from the U.S. government if industry sales begin to recover later this year. If the government were to eventually provide funding, we stress that we would likely view such assistance as buying more time rather than as solving the automaker's fundamental business risks, especially deteriorating global demand.
We believe Ford Credit has been less constrained recently than its peers in its ability to provide financing for Ford customers; this and other factors have contributed to Ford's market share stabilization.
Ford Credit relies heavily on the short-term debt and securitization markets to fund its automotive finance business, and these markets have been affected by the broader capital market turmoil.
But we believe the auto-related asset-backed securities (ABS) markets are showing signs of improvement. In our view, Ford Credit's various existing rated retail auto loan securitizations are currently performing within our rating expectations. We believe the company has limited unencumbered assets it could use to support additional borrowing. Ford said it is exploring a possible sale of its Volvo unit, although under the terms of Ford's credit agreement, half of the proceeds from any Volvo sale must be used to repay secured debt. We do not expect Ford to sell a stake in Ford Credit.
The developing outlook indicates our view that there is at least a one-in-three possibility that we could raise or lower the corporate credit rating during the next year.
We could consider revising the outlook to positive or raise the rating if, among other things, the global light-vehicle sales outlook begins to show sustained improvement, if Ford's prospects for generating free cash flow and profits in its automotive manufacturing business improve significantly, and if the fragile supply base does not cause a significant reduction in Ford's liquidity.
For example, we could raise Ford's rating if its cash use and losses continue to diminish significantly, leaving sustainable cash balances of more than $15 billion; if Ford's capital structure--including its bank credit maturity profile--improves; and if Ford demonstrates an ability to cope successfully with the evolving competitive structure of the global auto industry.
We could revise the outlook back to negative or review the rating for a downgrade if continued weakness in the global auto market in the remainder of 2009 and in 2010 and a very slow global economic recovery prevents Ford from reducing its cash use much further, preventing profitability and changes to its bank debt maturity structure.
We could lower the ratings if, among other things, we believed cash balances would drop significantly below $10 billion at any time, although in our view, this is increasingly less likely to occur in 2009. We believe the most likely trigger for a financial restructuring or bankruptcy filing remains a reduction in cash balances approaching levels that are insufficient to operate the business, caused by low vehicle sales and production rather than by any decision to file for bankruptcy to further improve its cost structure.
Una rating action tutta da leggere fra le righe...
Vedremo come andrà... di sicuro interesse le stime di S&P sull'andamento del mercato USA nel 2009 e nel 2010 e di quelli europei nello stesso periodo.
[FONT=Arial, Helvetica, sans-serif]Ford Motor Co. Outlook Revised To Developing From Negative On Progress In Reducing Cash Use[/FONT]
- Ford has slowed it cash use significantly and has shown early signs of stabilizing its U.S. market share.
- However, Ford continues to use cash from its global automotive operations.
- We are revising our outlook on Ford and related entities to developing from negative and affirming the ratings.
- The developing outlook indicates that we could raise or lower the
corporate credit rating during the next year.
NEW YORK (Standard & Poor's) July 27, 2009--Standard & Poor's Ratings Services today said it has revised its outlook on Ford Motor Co. and related entities to developing from negative. At the same time, we affirmed our ratings, including the 'CCC+' issuer credit ratings on Ford and Ford Motor Credit Co. LLC, as well as the 'B-' ratings on FCE Bank PLC, Ford Credit's European bank, maintaining the one-notch rating differential between FCE and its parent, Ford Credit.
"The outlook revision reflects early signs of progress by Ford in reducing cash use from its automotive operations and stabilizing, if not improving, its U.S. market share," said Standard & Poor's credit analyst Robert Schulz.
The company reported that it used $1.2 billion in cash, including cash restructuring costs and upfront subvention payments to Ford Credit, in its global automotive operations in the second quarter of 2009, much less than that used in the two previous quarters ($4.0 billion in the first quarter of 2009 and $7.4 billion in the fourth quarter of 2008).
In our view, there is now potential for us to raise Ford's ratings in the next year or so, although the possibility for a downgrade remains significant.
For example, we could consider raising the rating under the following scenario:
- If Ford's cash use and losses from global automotive operations continue to diminish significantly, leaving sustainable cash balances of at least $15 billion;
- If Ford improves its highly leveraged capital structure, including addressing its bank credit maturity profile; and
- If Ford is able to cope successfully with the evolving competitive
structure of the global auto industry.
Also, we still believe that the very fragile state of the interrelated auto supply base poses some risks to Ford's liquidity.
The cash use is being caused by weak auto sales in almost every market, but especially in the U.S. and Europe. Our economists forecast U.S. light-vehicle sales of about 9.9 million units this year, the lowest in nearly 40 years and down 25% from the 13.2 million units sold in 2008.
We currently expect sales to rise to 11.2 million units in 2010, but even with this improvement, sales would still be 15% below the weak levels of 2008.
The outlook for other major auto markets, including Europe, will also remain bleak, in our view, until economic stabilization becomes apparent. We expect sales in Europe to be lower in 2010 than in 2009, in part because of a shifting of sales from various government scrappage incentives. Ford and other high-volume automakers in Europe have benefited from these incentive plans in 2009, but we believe the boost to sales will be short-lived.
We believe Ford still faces the possibility of falling below the necessary levels of cash to run its automotive business--but perhaps not in 2009, given the progress it has shown in the first half of this year. We
estimate that this could occur if cash use in its automotive operations, including restructuring charges, exceeded about $12 billion total in 2009 and 2010.
In our view, the most likely catalysts for cash use of this magnitude would be if auto sales remained unchanged or worsened in 2010 from already weak 2009 levels, or if another spike in gas prices caused renewed pressure on Ford's product mix, which is still heavily weighted toward light trucks despite the company's successful initial steps to enhance its small and midsize car offerings.
We believe fundamental business risks will remain unchanged well into 2010 at least, most notably the company's exposure to weak vehicle demand globally, but also the substantial execution risk of the company's ongoing restructuring and repositioning.
Items that Ford can address over time, such as its manufacturing overcapacity, labor costs, and product line-up, may not, in our view, be sufficient to produce any meaningful free cash flow in the immediate future, although a stabilization of industry sales, even at low levels, would lead to lower cash use in 2009. Ford stated that the relatively strong second-quarter cash performance may not continue in the third quarter.
Industry sales remain weak in nearly all of Ford's key sales regions. Consequently, we expect Ford's cash use to continue through the end of this year and perhaps into 2010; however, in our view, there is an increasing likelihood that cash use will be measurably lower than it was in 2008 as the company benefits from slashed costs and reduced outflows from working capital effects.
We believe Ford may avoid revisiting its informal request for $9 billion in loans from the U.S. government if industry sales begin to recover later this year. If the government were to eventually provide funding, we stress that we would likely view such assistance as buying more time rather than as solving the automaker's fundamental business risks, especially deteriorating global demand.
We believe Ford Credit has been less constrained recently than its peers in its ability to provide financing for Ford customers; this and other factors have contributed to Ford's market share stabilization.
Ford Credit relies heavily on the short-term debt and securitization markets to fund its automotive finance business, and these markets have been affected by the broader capital market turmoil.
But we believe the auto-related asset-backed securities (ABS) markets are showing signs of improvement. In our view, Ford Credit's various existing rated retail auto loan securitizations are currently performing within our rating expectations. We believe the company has limited unencumbered assets it could use to support additional borrowing. Ford said it is exploring a possible sale of its Volvo unit, although under the terms of Ford's credit agreement, half of the proceeds from any Volvo sale must be used to repay secured debt. We do not expect Ford to sell a stake in Ford Credit.
The developing outlook indicates our view that there is at least a one-in-three possibility that we could raise or lower the corporate credit rating during the next year.
We could consider revising the outlook to positive or raise the rating if, among other things, the global light-vehicle sales outlook begins to show sustained improvement, if Ford's prospects for generating free cash flow and profits in its automotive manufacturing business improve significantly, and if the fragile supply base does not cause a significant reduction in Ford's liquidity.
For example, we could raise Ford's rating if its cash use and losses continue to diminish significantly, leaving sustainable cash balances of more than $15 billion; if Ford's capital structure--including its bank credit maturity profile--improves; and if Ford demonstrates an ability to cope successfully with the evolving competitive structure of the global auto industry.
We could revise the outlook back to negative or review the rating for a downgrade if continued weakness in the global auto market in the remainder of 2009 and in 2010 and a very slow global economic recovery prevents Ford from reducing its cash use much further, preventing profitability and changes to its bank debt maturity structure.
We could lower the ratings if, among other things, we believed cash balances would drop significantly below $10 billion at any time, although in our view, this is increasingly less likely to occur in 2009. We believe the most likely trigger for a financial restructuring or bankruptcy filing remains a reduction in cash balances approaching levels that are insufficient to operate the business, caused by low vehicle sales and production rather than by any decision to file for bankruptcy to further improve its cost structure.
paologorgo
Chapter 11
Barron's interviews Alan Mulally, CEO of Ford (F). Some excerpts:
S.A.
- The bankruptcies of General Motors and Chrysler have not put Ford at a disadvantage, and may even have helped Ford's sales. Ford is well on its way to creating a viable company without relying on Chapter 11 protection.
- The country may be pulling out of its recession. Looking at car sales specifically, the current selling rate is slightly below 10M vs. a peak of 16M. There will likely be 10.5-11M sales in 2009, 12.5M in 2010 and possibly 14.5M in 2011. The demand for the government's 'Cash for Clunkers' program is high, but Ford is being cautious in its estimates.
- Ford is on track to meet tougher gas-consumption rules. Mulally sees a higher gas tax as part of a comprehensive energy policy.
- Its impossible to predict how driving habits might fluctuate, but it's likely that "little will happen to change long-term habits." Since Americans will continue to drive and we'll keep paying more for energy, it's important to keep improving fuel mileage.
- Hybrids aren't going to change the fact that internal-combustion engine and the diesel engine are here to stay. Ford has two hybrids with more planned, but is also working to improve its regular engines. Hydrogen-powered cars have potential but there's a difficulty with the required infrastructure.
- Ford still needs "a significant cushion to deal with unknowns going forward. Things are still pretty fragile."
- In response to tough times, Ford is focusing on its brand by divesting from certain car brands. Ford is also working to serve every market segment, from trucks to small cars, in the markets it's in. Ford is bringing more of its global cars to North America, which will contribute to cost savings.
- Ford is trimming its dealer network, which its been working on for several years. "We've got the best dealer network in the business."
- Looking to the future, Ford wants to expand in Asia-Pacific. Its market will likely be divided with a third in Asia-Pacific, a third in Russia and Europe, and a third in the Americas. Chinese cars will continue to get better and better and Ford is in car ventures with some Chinese firms.
S.A.
stockuccio
Guest
un articolino in italiano ogni tanto http://www.chicago-blog.it/index.php/2009/08/government-motors-e-i-tesoretti-della-bad-company/
Government Motors e i tesoretti della Bad Company
Mario Seminerio
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Mentre si discute della apparentemente prossima stabilizzazione della congiuntura americana, almeno per il terzo trimestre, grazie anche al travolgente successo del programma di rottamazione auto “cash for clunkers” (che in realtà “prende a prestito” domanda dal futuro, e crea condizioni di dipendenza strutturale del settore dai sussidi pubblici, come ben sappiamo noi europei), giunge la notizia che General Motors riceverà un prezioso dono dal suo nuovo azionista di controllo, il governo degli Stati Uniti. Alla nuova GM, quella che emergerà dalla procedura di Chapter 11, sarà infatti consentito di utilizzare i crediti d’imposta derivanti dal “tax-loss carry forward”, cioè dal riporto a nuovo delle perdite a compensazione degli utili futuri, fino a 20 esercizi successivi. L’entità di questo dono è pari a 16 miliardi di dollari.
In condizioni normali, le perdite non sopravvivono alla procedura di bankruptcy: esiste, infatti, una sezione del tax code specificamente disegnata per impedire che aziende sane ne acquistino altre decotte al solo scopo di costituire uno schermo d’imposta a protezione dei propri utili futuri. Tale norma prevede che le imprese che cambiano proprietà a seguito di riorganizzazione non possano fruire delle perdite accumulate dalla vecchia società. Questo è esattamente il caso di GM, a maggior ragione perché la riorganizzazione del carmaker è avvenuta attraverso il ricorso all’articolo 363 del Bankruptcy Code, che crea una bad company ed attenua significativamente il processo di protezione dei creditori. Ma la differenza tra una procedura “normale” e quella di GM la fa il nuovo proprietario di quest’ultima, il governo federale.
Secondo alcuni osservatori la procedura non sarebbe realmente rilevante, perché il governo possiede il 60 per cento della nuova società e l’imposizione su futuri utili non schermati si risolverebbe in una partita di giro. Ma questo ragionamento omette di considerare che la concessione accresce il valore economico della società, destinando i benefici anche al restante 40 per cento di azionariato. E in tale azionariato di “minoranza” è presente, con il 17,5 per cento, il fondo sanitario dei pensionati del potente sindacato United Auto Workers. L’aumento di cassa di cui GM fruirà a seguito dello schermo fiscale permetterà all’azienda di disporre di munizioni impiegabili sia per beneficiare i pensionati del sindacato (che sono pur sempre elettori), che per distorcere la concorrenza a danno di altri costruttori automobilistici.
Business as usual: mentre in passato General Motors agiva per interposto lobbying, oggi quella finzione è caduta. Saremo naïf e moralisti, ma ogni volta che leggiamo di queste pratiche riusciamo ancora a stupirci ed indignarci. E sì che noi italiani una certa esperienza in materia dovremmo averla.
http://www.chicago-blog.it/index.php/2009/08/government-motors-e-i-tesoretti-della-bad-company/Government Motors e i tesoretti della Bad Company
Mario Seminerio
Vai ai commenti Lascia un commento
Mentre si discute della apparentemente prossima stabilizzazione della congiuntura americana, almeno per il terzo trimestre, grazie anche al travolgente successo del programma di rottamazione auto “cash for clunkers” (che in realtà “prende a prestito” domanda dal futuro, e crea condizioni di dipendenza strutturale del settore dai sussidi pubblici, come ben sappiamo noi europei), giunge la notizia che General Motors riceverà un prezioso dono dal suo nuovo azionista di controllo, il governo degli Stati Uniti. Alla nuova GM, quella che emergerà dalla procedura di Chapter 11, sarà infatti consentito di utilizzare i crediti d’imposta derivanti dal “tax-loss carry forward”, cioè dal riporto a nuovo delle perdite a compensazione degli utili futuri, fino a 20 esercizi successivi. L’entità di questo dono è pari a 16 miliardi di dollari.
In condizioni normali, le perdite non sopravvivono alla procedura di bankruptcy: esiste, infatti, una sezione del tax code specificamente disegnata per impedire che aziende sane ne acquistino altre decotte al solo scopo di costituire uno schermo d’imposta a protezione dei propri utili futuri. Tale norma prevede che le imprese che cambiano proprietà a seguito di riorganizzazione non possano fruire delle perdite accumulate dalla vecchia società. Questo è esattamente il caso di GM, a maggior ragione perché la riorganizzazione del carmaker è avvenuta attraverso il ricorso all’articolo 363 del Bankruptcy Code, che crea una bad company ed attenua significativamente il processo di protezione dei creditori. Ma la differenza tra una procedura “normale” e quella di GM la fa il nuovo proprietario di quest’ultima, il governo federale.
Secondo alcuni osservatori la procedura non sarebbe realmente rilevante, perché il governo possiede il 60 per cento della nuova società e l’imposizione su futuri utili non schermati si risolverebbe in una partita di giro. Ma questo ragionamento omette di considerare che la concessione accresce il valore economico della società, destinando i benefici anche al restante 40 per cento di azionariato. E in tale azionariato di “minoranza” è presente, con il 17,5 per cento, il fondo sanitario dei pensionati del potente sindacato United Auto Workers. L’aumento di cassa di cui GM fruirà a seguito dello schermo fiscale permetterà all’azienda di disporre di munizioni impiegabili sia per beneficiare i pensionati del sindacato (che sono pur sempre elettori), che per distorcere la concorrenza a danno di altri costruttori automobilistici.
Business as usual: mentre in passato General Motors agiva per interposto lobbying, oggi quella finzione è caduta. Saremo naïf e moralisti, ma ogni volta che leggiamo di queste pratiche riusciamo ancora a stupirci ed indignarci. E sì che noi italiani una certa esperienza in materia dovremmo averla.