Ford Motor Seeks to Raise Money to Invest in New Technologies
December 05 2016 - 12:20PM
Dow Jones News
By Christina Rogers
Ford Motor Co. is seeking to raise about $2 billion in new
long-term financing for the automotive business, as the company
tapped debt markets for the first time in nearly four years to fund
a core auto-making operation looking to invest in new
technologies.
The No. 2 U.S. auto maker which disclosed the debt issuance in a
regulatory filing Monday and said it would take advantage of
favorable market conditions to raise money for "general corporate
purposes." The last time Ford issued new automotive debt was in
January 2013, when it raised $2 billion in 30-year notes at
4.75%.
The move comes after several years of banking big profits on
increasing sales of trucks and sport utilities. The company has
signaled it expects increased pressure as the U.S. light-vehicle
market plateaus, regulatory costs increase and the race to make
cars more autonomous heats up.
"Consistent with our recent investor day presentations, we
continue to increase on investments in emerging opportunities,
primarily in the areas of electrification, autonomy and mobility,"
the company said in a statement.
Ford is moving to diversify its operations beyond its core
business of building and selling cars, moving into new areas, such
as ride-hailing and autonomous vehicles.
The Dearborn, Mich., auto maker's capital spending is expected
to rise to 5.6% of revenue in the next two years from 4.9% in 2016,
as Ford steps up investment and acquisitions related to new
businesses.
Write to Christina Rogers at christina.rogers@wsj.com
(END) Dow Jones Newswires
December 05, 2016 12:05 ET (17:05 GMT)
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