Mazda gets junk rating from S&P...Ford???

[Antoine]

Mazda gets junk rating from S&P;
Ford cited

Mazda Motor Corp. received a long-term credit rating of BB-, three levels below investment grade, from Standard and Poor's, which cited the automaker's links to biggest shareholder Ford Motor Co. and the company's reliance on exports. S&P, which released its first ratings on Mazda on Tuesday, said in a statement the rating is "closely linked with that on 34.2% owner Ford, which exerts a high degree of management control over Mazda." The rating on the Hiroshima, Japan-based automaker "reflects the company's limited competitive position in the global auto industry, high exposure to foreign exchange risk and weak financial profile," Standard & Poor's credit analyst Chizuko Satsukawa said in a statement.

-mazdanews

[Antoine]

I think that's a load of BS...Although the domestic market may be slow...Mazda seems to be picking up a lot of steam where it counts...in the states and Europe. Mazda is a really strong brand with LOADS more substance than Toyota, GM or FORD...The potential for growth is there and is being realized...

[anarchistchiken]

Agreed, but maybe they dont take into account the european and asian markets? Also, the investments they're talking about are long term. Ford owns a large part of Mazda, and has a great deal of control over their operations, and if Ford continues down the path they are on now, Mazda and all the other subsidiaries might be in trouble.

[TampaSport20]

S & P is garbage...They have WAY too much control over the financial futures of corporations ...If they give a junk rating, this also lowers thecompanies CREDIT rating, which increases their borrowing costs....this causes BIG problems for financial institutions like Ford Motor Credit or Mazda North American Credit, which base the interest rates they give customers on their loans by the their own borrowing costs...(you didnt really think GMAC,FMCC finance those loans on liquid assets did you??)..Their borrowing costs are based on the credit ratings of the parent company.
GMAC and FMCC(MNAC is part of FMCC) cannot compete with banks on interest rates. So S & P actually compounds the problems a company has by giving them a lower rating...

Keep in mind GMAC and FMCC are VERY profitable companies, and deserving of a higher rating, but are being brought down by the parent company !!

The SYSTEM sucks !!!!

P.S. Antoine...Mazda is becoming a profitable company after over a DECADE in the red...they are on the rise, and show no signs of slowing down....Consumers will ultimately make S & P change their rating

[TampaSport20]

Agreed, but maybe they dont take into account the european and asian markets?

Actually they do

[romecandleboy]

More Toyota propaganda ;)

[03MzdSpdSTP]

mazda does make a profit unlike ford...........but mazda also do not sell nearly high in numbers to make a difference. Mazdas are a niche market. Ford will probabably not sell off Mazda because they do bring in profit. They have been on a roll with new car introductions, cars that people acutally want.

[TampaSport20]

mazda does make a profit unlike ford...........

umm...Where did you get the info that Ford doesnt make a profit

here's a small excerpt from an article about Ford's earnings

"Still, company executives, meeting with analysts in New York, said the automaker remained on track to post a $7 billion pretax profit in 2006."

[03MzdSpdSTP]

http://www.iht.com/articles/1993/02/11/ford.php

[toucci]

http://www.iht.com/articles/1993/02/11/ford.php
notice the article's from 1993 (hah)

I think you're confusing GM's poor performance with Ford.

[03MzdSpdSTP]

oh well.

Anyways then you guys are both right. Ford makes a profit. thats why the market rating is junk. Companys that make money are junk right?

[TampaSport20]

http://www.iht.com/articles/1993/02/11/ford.php

bwahahahahaahaha !!!! (hah)

check your info there , big guy !!!

hate to tell you this but 2003 was the first year in over a decade that Mazda actually made ANY money !!

[TampaSport20]

oh well.

Anyways then you guys are both right. Ford makes a profit. thats why the market rating is junk. Companys that make money are junk right?

There are plenty of companies that are making money that get a junk rating from S & P...please make sure you fully understand S & P's ratings before you comment on them...otherwise you come off looking like an ignoramus