Ford and GM Rated Junk

[JeepZJ4.0]

http://www.caranddriver.com/article.asp?section_id=30&article_id=6627

quote:

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The Daily Auto Insider
Friday, May 6, 2005
May 2005


Not the cars, but the bonds that America's number one and two automakers issue as IOUs to raise capital for new product development and other business purposes, have been downgraded by Standard & Poor's to "junk bond" status, according to the Dow Jones Newswires.

S&P said it slashed the debt ratings of about $291.8 billion worth of bonds issued by General Motors and its financing arm, General Motors Acceptance Corp., two notches to double-B from triple-B-minus. The ratings agency also cut the ratings of $161 billion in debt issued by Ford and its financing arm, Ford Motor Credit Co., one notch to double-B-plus from triple-B-minus.

S&P said the rating outlook on both automakers is negative and cited questions about the strategies the automakers are following to reverse their sliding sales and North American market shares.

Ford's Chief Financial Officer Don Leclair said in a statement, "We disagree with S&P's action today. We're disappointed that it discounts our considerable liquidity and our access to diverse funding sources, as well as the recent successes of our new products."

GM said it was disappointed with S&P's decision. "GM and GMAC have adequate cash and liquidity to fund their business for the foreseeable future," a spokesman said.

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I saw that coming. I'm disappointed with those two companies. We used to own Fords out the wazoo but my father bought a Chrysler and said he probably won't be going back to Ford.

 

[Scooby]

Talk about denial.

This is what I hear: "We don't think they are right. Therefore we are going to continue to build the same vehicle we have been building without changing or fixing problems as long as we can pay for it."

I would rather hear: "We see that we have some problems. We are researching the problem and intend on fixing them asap."

What I say: "I will continue to buy Toyota as I have for many years because none of the domestics can make a quality vehicle in the arena that I need."

 

[JeepZJ4.0]

I agree with the majority of your statement. The part about domestics vs. Toyota... have you gotten into a Chrysler lately? We have a 02 Avalon and a 04 Pacifica. Wow. I prefer the leather of the Avalon but the Pacifica is just more pleasing to the eye on the interior. A lot softer surfaces.

My father has an 00 Grand Cherokee. I've been inside some 00 4Runners.... hands down to the Jeep. Just a better interior. Reliability... well, i guess the Japanese have the upperhand. Our Pacifica has had nothing happen to it. Nothing has gone wrong. *knocks on wood* The Avalon.... well, it had some problems but they dealer couldn't reproduce them. The steering squeak was a simple power steering pump fluid problem. Both good cars.

 

[Steve S]

That is because they are junk. They were the best in the world untill the late 1970's