The second-biggest North American automaker, Ford, is, according to a source that has knowledge of the matter, seeking to expand its existing financing, by adding $1.3 billion to reach $12 billion on its existing credit lines.
The person, familiar with the US carmaker’s plans, asked to remain unidentified because the proceedings are not final, but said Ford plans to uphold a $9 billion revolving loan set to expire in the next five years and also a $3 billion financing pact that should conclude in three years.
Both loans should actually replace a $10.7 billion credit line due 2017, with the Dearborn, Michigan-based company, probably paying up to 150 basis points, or 1.5 %, more than the three-month London interbank offered rate.
According to the same source that talked to Bloomberg, JPMorgan Chase & Co. is leading the financing. Although the company has among the best finances since 1999, as Chief Executive Officer Alan Mulally managed to cut costs and refreshed some of the vehicles – making them bigger sellers – Ford needs additional cash as it prepares a never before seen product offensive this year.