Why Ford applies for German Covid-19 loan guarantees worth $582 million?

Ford Motor Company is one of the global automotive and mobility company. The NYSE: F at https://www.webull.com/quote/nyse-f company is a full line of Ford cars, trucks, and sport utility vehicles (SUVs), as well as Lincoln luxury vehicles. The company is operating in four segments that are including Automotive, Financial Services, Ford Smart Mobility LLC, and Central Treasury Operations. The Automotive segment is primarily including the sale of Ford and Lincoln brand vehicles, service parts, and accessories across the world. The Financial Services segment is primarily including its vehicle-related financing and leasing activities at Ford Motor Credit Company LLC. Ford Smart Mobility LLC is a subsidiary formed that are design, build, grow, and invest in emerging mobility services. It is decision making for investments and risk management activities that is providing financing for the Automotive segment.

German Covid-19 loan guarantees

  • BERLIN (Reuters) – Ford Motor NYSE: F, which is operating two auto plants in Germany. It has applied for 500 million euros ($582 million) of German loan guarantees aimed at cushioning the impact of the COVID-19 pandemic, business daily Handelsblatt reported on Monday.
  • While Germany has given coronavirus-related aid to companies such as auto parts supplier Leoni, Ford would be the first major carmaker in the country to receive such help from the government.
  • The auto sector, one of the key pillars of Germany’s industry, was struggling even before the pandemic due to the shift towards electric vehicles and lower worldwide demand.
  • Ford wants the federal government to grant most of the loan guarantees, while a smaller share is expected to come from German states, Handelsblatt said, without citing its sources.
  • The company said it was part of its normal business to be in contact with financial institutions, without providing further details.
  • The economy ministry declined to comment on the report.
  • Ford’s German subsidiary was founded in 1925 and operates factories in the western city of Cologne and Saarlouis close to the French border.
  • Before the coronavirus pandemic hit automakers, Ford was planning to eliminate about 20 percent of the workforce across its European operations.
  • The automaker has struggled in the region’s crowded and mature market for years and it has been particularly hard hit by falling car sales in the UK because of the uncertainty surrounding the country’s exit from the European Union.
  • Ford’s passenger car sales in the EU, EFTA, and UK fell 38 percent to 401,722 in a market down 33 percent through August, according to data from industry association ACEA. You can do stock trading with NASDAQ TotalView free software.

Disclaimer: The analysis information is for reference only and does not constitute an investment recommendation.

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