SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) October 9, 1997
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FORD MOTOR CREDIT COMPANY
(Exact name of registrant as specified in its charter)
Delaware 1-6368 38-1612444
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(State or other juris- (Commission File Number) (IRS Employer
diction of incorporation Identification No.)
The American Road, Dearborn, Michigan 48121
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 313-322-3000
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ITEM 5. Other Events.
On October 8, 1997, Standard & Poor's Ratings Group ("S&P") announced that
it had lowered certain debt ratings of Ford Motor Company ("Ford") and certain
of its affiliates. S&P's news release dated October 8, 1997, filed as Exhibit 99
to this Current Report on Form 8-K, is incorporated by reference herein.
Also on October 8, 1997, Moody's Investor Service confirmed all of the debt
ratings of Ford and its affiliates, including the senior long-term debt rating
of "A1" for Ford, Ford Motor Credit Company ("Ford Credit") and Ford Credit
Europe plc and of "A3" for The Hertz Corporation ("Hertz"), and the commerical
paper rating of "Prime-1" for Ford Credit, Ford Credit Europe plc and Hertz.
ITEM 7. Financial Statements, Pro Forma Financial Information and Exhibits.
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EXHIBITS
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Designation Description Method of Filing
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Exhibit 99 S&P's news release dated Filed with this Report
October 8, 1997
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized on the date indicated.
FORD MOTOR CREDIT COMPANY
(Registrant)
Date: October 9, 1997 By:/s/R. P. Conrad
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R. P. Conrad
Assistant Secretary
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EXHIBIT INDEX
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DESIGNATION DESCRIPTION
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Exhibit 99 S&P's news release dated
October 8, 1997
EX-99
S&P Press Release
Certain Ford Motor, Related Entities Ratings Lowered by S&P
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Wednesday, October 8, 1997 05:59 PM
NEW YORK, -- Standard & Poor's today lowered certain ratings of Ford Motor
Co. and various related entities (see list below). The ratings outlooks are
stable (except as noted below).
Ratings of Associates First Capital Corp. (The Associates) and
subsidiaries were affirmed (see separate press release).
Debt outstanding totals approximately $164 billion.
The downgrades reflect the significant deterioration in Ford's financial
flexibility that will result from completion of the just-announced plan to
distribute to shareholders its 80.7% ownership stake in The Associates. This
holding -- which has a current market value of over $17 billion -- had been
viewed by Standard & Poor's as an important store of value. Moreover, the
substantial and growing earnings contribution of The Associates had afforded
Ford some measure of diversity amidst its cyclical automotive business.
Ford's financial flexibility remains considerable, particularly in light
of its large cash position. Also, the company's earnings have been at record
levels in recent quarters, owing in large part to cyclically robust demand
levels, its successful new sport utility and pickup offerings, the benefits of
accelerated cost-cutting efforts, and some success in turning around the
performance of its problematic European and Latin American operations.
OUTLOOK: STABLE
Continued favorable market conditions in North America over the next one
to two years should enable Ford to maintain excellent overall financial
results. Over the longer term, though, Ford's financial flexibility could
well be tested. An eventual cyclical downturn is inevitable. Certain major
Japanese automakers are enjoying a resurgence in their competitiveness in
North America. The secular shift in consumer preferences from conventional
passenger cars to light truck alternatives -- which now account for a highly
disproportionate share of Ford's earnings -- has been slowing, while many new
competing products are being introduced. In addition, the Western European
automotive industry remains beset by excess production capacity, which could
impede Ford's ability to achieve adequate profitability in that market. --
CreditWire
RATINGS LOWERED
Rating
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To From
-- ----
Ford Motor Co.
Corporate credit rating A/Stable/A-1 A+/Stable/A-1
Senior debt A A+
Preferred stock A- A
Bank loan A A+
Ford Motor Co. of Australia Ltd.
Corporate credit rating A-/Stable/- A/Stable/-
Ford Motor Credit Co.
Counterparty credit rating A/Stable/A-1 A+/Stable/A-1
Senior debt A A+
Subordinated debt A- A
Bank loan A A+
Ford Credit Australia Ltd.
Ford Motor Credit Co. of New
Zealand Ltd.
Ford Credit Canada Ltd.
USL Capital Corp.
Senior debt** A A+
Ford Holdings Inc.
Senior debt* A A+
Ford Motor Co. Capital Trust I
Preferred stock A- A
Ford Credit Europe PLC
Corporate credit rating A/Stable/A-1 A+/Stable/A-1
Senior debt A A+
Bank loan rating A A+
Ford Capital B.V.
Sr debt* A A+
Hertz Corp.
Corporate credit rating BBB+/Neg/A-2 A-/Neg/A-1
Senior debt BBB+ A-
Subordinated debt BBB BBB+
Commercial paper A-2 A-1
Hertz Finance Centre PLC
Hertz Australia Pty Ltd.
(gtd: Hertz Corp.)
Commercial paper A-2 A-1
RATINGS AFFIRMED
Ratings
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Ford Motor Credit Co.
Commercial paper** A-1
Ford Capital B.V.
Ford Motor Co. S.A. de C.V.
Commercial paper* A-1
Ford Credit Europe PLC
Commercial paper A-1
CDs A-1
Associates First Capital Corp.
Counterparty credit rating A+/Stable/A-1
Commercial paper A-1
Associates Corp. of North America
Counterparty credit rating AA-/Stable/A-1+
Senior debt AA-
Subordinated debt A+
Commercial paper A-1+
*Guaranteed by Ford Motor Co.
**Guaranteed by Ford Motor Credit Co.
SOURCE Standard & Poor's CreditWire
CONTACT: Scott Sprinzen of S&P, 212-208-1667
