Ford has announced that it plans to obtain financing totalling about US$18bn by the end of 2006 in order to fund its restructuring and provide a cushion against a possible recession.
Ford said the financing would take the form of a new five-year, US$8bn revolving credit facility, a senior secured term loan of about US$7bn and US$3bn in transactions that could include unsecured notes that would be convertible into Ford common stock.
Citigroup Inc., Goldman Sachs Group Inc. and J.P. Morgan Securities Inc. have been hired to arrange the financing.
Upon completion of the transactions, Ford expects to have automotive liquidity of approximately US$38bn at by the end of 2006.
Speculation is growing that the US light vehicle market could be heading for contraction in 2007 on the back of slower economic growth and a downturn for the housing market.