Total debt is $146.92 billion, according to Ford Motor’s most recent balance sheet, which was released on July 29, 2021, with $100.91 billion in long-term debt and $46.01 billion in current debt. The company’s net debt is $123.96 billion after accounting for $22.95 billion in cash equivalents.
Let’s define some of the terminology used in the preceding paragraph. The portion of a company’s debt due within a year is called current debt, while the portion due in more than a year is called long-term debt. Cash and liquid securities with maturities of 90 days or less are considered cash equivalents. Current debt plus long-term debt minus cash equivalents equals total debt.
Does Ford have a debt problem?
In 2020, Ford Motor Company’s total debt was estimated to be between 161 and 162 billion dollars. Automobile debt, credit debt, and other debt make up total debt.
Who has more debt GM or Ford?
S&P and Moody’s Investment Services are keeping an eye on both companies for downgrades. Fiat Chrysler is also being scrutinized by investment rating firms, albeit its stock could rise as a result of its impending merger with PSA Group, a French automaker.
On Thursday, Fitch downgraded Ford and GM, as well as their financial departments. GM was downgraded to BBB- from BBB, and Ford was downgraded to ‘BB+’ from ‘BBB-.’ Both downgrades were based on the assumption that the coronavirus epidemic would keep their credit profiles weak for a long time.
Ford was downgraded from investment grade to junk status by Moody’s in September, while S&P Global Ratings reduced its credit rating to BB+, one notch below investment grade, in March. With Moody’s, GM is slightly above junk at Baa3.
Ford’s debt, excluding its lending arm, was $15.3 billion at the start of this year, up $1.2 billion from the previous year. In comparison, GM’s revenue in 2019 was over $14.4 billion, up $423 million from the previous year.
Like a bank, the finance arms usually have a lot of debt. Ford Credit had a market capitalization of around $140 billion at the end of last year. GM Financial has a market capitalization of $96.5 billion.
Ford, according to S&P, was “Before the Covid-19 outbreak, it was “borderline for an investment-grade rating,” according to the downgrade, which cited its debt burden and lack of competitive position as factors for the reduction.
Ford is in the middle of a $11 billion restructuring plan that began in 2018 and includes a $7 billion financial outlay. The plan, according to Ford’s Stone, is still in place “on track,” despite the fact that, unlike any other catastrophe, the coronavirus has forced other automakers to rethink their strategies.
“On April 28, Ford CEO and President Jim Hackett told investors, “I never had a business plan that was labeled pandemic.” “That is something I truly believe, because we never envisioned the economy shutting down. And we had deep troughs of troubles in the last two crises I was in, but this was different.”
How much is GM in debt?
GM’s most recent financial statement, released on February 10, 2021, revealed a total debt of $109.89 billion, including $72.98 billion in long-term debt and $26.91 billion in current debt, according to Yahoo! Finance. GM has a net debt of $89.90 billion after accounting for $19.99 billion in cash equivalents.
On July 22 (pre-market opening), GM’s market capitalization was $82.76 billion. Its gross revenue for 2020 was $122 billion, with net revenues of $9.7 billion before interest and taxes (EBIT). It has an 11.2 percent gross margin.
How much is Tesla’s debt?
Tesla was paying $95.4 million in interest each year on its $1.8 billion debt. To call the bonds, the corporation had to pay a premium of 102.65% of the face value, or $47.7 million.
How much does Ford owe the government 2021?
Ford announced on Friday that it had requested and received permission from the US Department of Energy to delay debt payments for a 2009 government loan.
According to a bankruptcy specialist who follows bankruptcy patterns closely, the action is “worrisome.”
Ford owes $591 million in 2020, $591 million in 2021, and $289 million in 2022, according to regulatory records filed by the firm.
“The idea that Ford Motor Company, a multibillion-dollar corporation, needs to defer loan payments of that magnitude would be a troubling message to their investors,” said Charles Elson, director of the University of Delaware’s Weinberg Center for Corporate Governance.
“They’re definitely trying to save money, but why for such a small amount for such a large corporation? You must inquire as to why “he stated
Ford said that in June it changed the terms of the government loan, reducing quarterly payments on the principle due from $148 million to $37 million. Ford also acknowledged that $1.26 billion is still owed on the principal, and that deferring the payment will result in additional expenditures such as interest and a higher interest rate.
Did Ford repay their bailout?
Ford Motor Company is still paying off a large government loan created at the onset of the Great Recession to help manufacturers with factory projects, more than a decade after the last economic crisis.
During the car crisis that ravaged the industry between 2008 and 2010, critics concentrated on GM and Chrysler, which both declared bankruptcy and accepted government bailout funding under the US Treasury Department’s Troubled Asset Relief Program (TARP) to reorganize. Ford, on the other hand, chose a different course.
Ford entered into an arrangement with the Department of Energy in September 2009 to borrow $5.9 billion as part of a loan program meant to help vehicles made in the United States satisfy greater mileage requirements and reduce the country’s reliance on foreign oil.
On the Advanced Technology Vehicles Manufacturing (ATVM) loan program website, the company is one of three auto grantees currently listed.
While critics of government help, including Ford executives, continue to focus on the bailouts, few have addressed in recent years the loan program that provided money to automakers during the same time period.
Because Ford was in difficulty before everyone else and took action before anybody else, then-CEO Alan Mulally is hailed for having the foresight to mortgage everything immediately prior to the crisis, even the Blue Oval.
More:Lawyers expect that Ford Fiesta and Focus owners will receive thousands of dollars each.
More:In the midst of a pandemic, Ford is counting its cash after executive pay of $70 million exceeded the company’s earnings in 2019.
Ford, Nissan, and Tesla are among the loan recipients of a scheme with stringent financial soundness standards. Nissan’s Tennessee operations were awarded $1.6 billion. Tesla received $465 million for its operations in California.
According to CNBC, both Tesla and Nissan had fully repaid their loans as of September 2017. Ford had not done so.
Ford will be burdened by the debt plus interest as cash supplies dwindle.
“A total of $1.5 billion was outstanding as of December 31, 2019,” Ford said in its most recent 10-K filing with the Securities and Exchange Commission. “The ATVM loan is repayable in $148 million quarterly payments beginning in September 2012 and ending in June 2022.”
Ford owes $591 million in 2020, $591 million in 2021, and $289 million in 2022, according to documents filed by the corporation.
“They’ll have to figure out a means to pay, or else they’ll end up paying more for the privilege of borrowing,” said Charles Elson, director of the University of Delaware’s Weinberg Center for Corporate Governance. “It’s stuff like this that keeps folks awake at night. This is a problem that the management team is dealing with at 3 a.m.”
How is Ford doing financially?
Ford Motor Company reported $4.8 billion in earnings before interest and taxes for the first three months of this year, with a net income of $3.3 billion, a significant improvement over the same period a year ago, despite the challenges ahead.
Ford reported a $632 million loss in earnings before interest and taxes in the first three months of 2020, the company’s first quarterly deficit since the Great Recession in 2009. A year ago, the corporation had a net loss of $2 billion.
However, Ford has warned that major parts supply problems connected to semiconductor chips are expected in the next three months, which might result in a 50 percent reduction in scheduled production. This is projected to have a significant impact on revenue, earnings, and cash flow in the second quarter.
The corporation announced on Wednesday that adjusted EBIT for the first quarter of this year was $4.8 billion, up from a negative $632 million in 2020 and $2.4 billion in the first quarter of 2019.
The $3.3 billion in net income was an increase from a negative $2 billion in 2020 and a positive $1.1 billion in 2019.
Ford has $31 billion in cash and $47 billion in liquidity at the conclusion of the quarter.
In a conference call with reporters, John Lawler, Ford’s chief financial officer, said, “What you’re seeing come through the figures is good execution by the team, as Ford has always done in a crisis, and as we adjust to the realities of what we’re seeing in the marketplace.” “The business is being impacted by the semiconductor scarcity.”
He claims that supply chain disruptions, such as the worldwide shortage of popular automotive semiconductors, have resulted in tighter supplies and fewer incentives, which can help increase profits.
“We’re learning to be more resilient.” “We’ve grown as a company,” Lawler stated. “This is due to the long-term adjustments we’re making to the company.”
He highlighted $454 million in earnings before interest and taxes outside of North America for the quarter, up $980 million from the previous year.
According to Lawler, the “true improvement” is in warranty expenses, which the business “lowered by $400 million compared to last year.” Ford’s warranty costs have increased by more than $2 billion in the last three years, he said.
Ford also benefited from its ownership position in Rivian, an electric vehicle manufacturer that conducted a public funding round in January, resulting in a non-cash $902 million gain for the company in the first quarter.
More:In 2022, Ford will open the $185 million ‘Ford Ion Park’ lab to speed up battery development.
For the time being, Ford and the Detroit auto industry Three automakers will continue to struggle as they and other businesses deal with the economic nightmare triggered by COVID-19 and then the chip scarcity that has paralyzed manufacturing.
According to Lawler, Ford has manufactured and kept 22,000 automobiles, mostly in North America, that are waiting for chip components to be installed.
On a conference call with industry analysts on Wednesday, Ford CEO Jim Farley said, “Ford is becoming a stronger, more resilient corporation that can perform under pressure.” “Our staff handled the supply constraints with aplomb.”
“Before it gets better, the semiconductor shortfall and its impact on manufacturing will get worse,” Farley said. “We’re using this occasion to rebuild our supply chain in order to eliminate future risks.”
According to Edward Jones analyst Jeff Windau, manufacturing of slightly over 1 million cars will be lost owing to unavailability parts in 2021, which is more than 20% of Ford’s planned production. “Ford stated that the problem may not be completely remedied until 2022.”
Meanwhile, Ford Credit made $962 million in profits, up from $30 million in 2020.
The automaker exceeded Wall Street analyst projections with a first-quarter profit of $1.12 per share, adjusted, or $1.31 per share diluted.
Ford announced leadership changes at its operations in China, India, and South America early Wednesday, prior to the earnings release, in order to speed up the company’s recovery in those locations.
More:After a $2 billion loss, one analyst thinks Ford needs to “take the Band-Aid off”: What he means
While the semiconductor shortage has afflicted the entire industry, Ford has been particularly hard struck due to its large number of new product introductions.
“The unpleasant fact of present supply constraints is that they are preventing the company from fully capitalizing on what should have been an exciting product phase that would have produced a halo effect for the brand,” she added.
“The Ford F-150 remains one of the industry’s most wanted pickups, and while first-quarter sales were flat, the business has maintained improvements in average transaction prices, which should help drive profitability,” Caldwell said. “Ford is holding on for the time being, but as the chipset scarcity persists with no end in sight, it may find itself in a less safe position.”
Ivan Drury of Edmunds prepared a sales data analysis of the Detroit Three for the first quarter in the United States, which shows:
- With 521,334 cars sold versus 642,571 for General Motors, Ford fell behind. 476,909 automobiles were sold by Stellantis. Ford increased barely 1% year over year, compared to GM’s 3.9 percent and Stellantis’ 6.7 percent.
- Ford had a 13.4% market share compared to GM’s 16.5 percent. Stellantis’ share price remained stable at 12.2 percent.
- While all average purchase prices increased, Ford’s average transaction price remained the highest at $47,838. GM increased to $44,567, while Stellantis increased to $45,141.
- The fastest vehicle off the lot was sold by GM in 56.7 days, followed by Ford in 64 days and Stellantis in 65 days.
- The greatest trade-in loyalty percentage was 54.7 percent for GM, 53.2 percent for Ford, and 50.2 percent for Stellantis. In comparison to a year ago, GM and Stellantis both reported a reduction in customer loyalty of about 2%, while Ford saw an increase of nearly 8%.
Why is Ford dying?
Ford is on its way out. Since 2001, it has been downsizing. It is attempting to cut costs everywhere, which means that no one has had a pay hike in over 2.5 years, and benefits have been reduced. Unfortunately, it is a loss-making, badly managed firm that will betray its people to save money.
How much is Apple’s debt?
Apple filed a preliminary filing with the Securities and Exchange Commission on Thursday for a four-part debt offering that will comprise notes with maturities of 7, 10, 30, and 40 years. The size and timing of the offering were not disclosed by the corporation.
Apple (AAPL) currently owes $113.8 billion in long-term debt, including current maturities. The figure includes $14 billion raised in a February offering.
Is BMW in debt?
Bayerische Motoren Werke had €105.3 billion in debt in March 2021, down from €119.2 billion the year before. It did, however, have €17.9 billion in cash, bringing its net debt to €87.4 billion.
How Healthy Is Bayerische Motoren Werke’s Balance Sheet?
Bayerische Motoren Werke has liabilities of €75.5 billion due within 12 months and €83.0 billion due beyond 12 months, according to the most recent balance sheet. It has €17.9 billion in cash and €3 billion in receivables due in the next 12 months to offset this. As a result, its liabilities exceed its cash and short-term receivables by €137.6 billion.
This imbalance, like a behemoth towering over lowly mortals, casts a shadow over the €54.6 billion firm. So, without a question, we’d keep a tight eye on its financial statements. After all, if Bayerische Motoren Werke had to pay its creditors today, it would very certainly require a massive re-capitalization.
We utilize two major ratios to figure out how much debt we have in relation to our profits. The first is net debt divided by earnings before interest, taxes, depreciation, and amortization (EBITDA), while the second is the number of times earnings before interest and tax (EBIT) covers interest expense (or its interest rate).
Our View
On the surface, Bayerische Motoren Werke’s net debt to EBITDA ratio made us wary of the stock, and its total liabilities level was no more appealing than one empty restaurant on the busiest night of the year. However, it does a good job of covering its interest expense with EBIT, which is reassuring. After evaluating the information presented, we believe Bayerische Motoren Werke has an excessive amount of debt. While some investors enjoy taking risks like this, it’s not our cup of tea. When it comes to debt analysis, the balance sheet is definitely the place to start. However, the balance sheet does not contain all investment risk; much from it. For example, Bayerische Motoren Werke has two red flags (one of which is particularly worrying) that you should be aware of.
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How much is Elon Musk salary?
Elon Musk, the company’s Chief Executive Officer, said in a recent announcement that his income for the previous year was $0. The electric vehicle manufacturer made many statements on planned initiatives in a regulatory filing.
Musk’s salary in 2019 was $23,760, according to the declaration, but it was zero in 2020. The base salaries, according to the statement, are determined by individual jobs, performance, and the competitive market.
