Ford Credit Bonds for $1.5B

[IndyPoolPlayer]

https://www.marketwatch.com/story/ford-credit-eyes-1-billion-bond-funding-as-yields-hit-2009-highs-investors-weigh-recession-fears-11667327855?mod=search_headline

 

Quote

Ford Motor Credit tapped the U.S. corporate bond market on Tuesday for $1.5 billion in funding, despite recession fears and major companies having to pay investors yields that have hit a 13-year high. Even with tougher credit conditions, the vehicle giant’s financing arm attracted about $3.5 billion of investor orders for the new 5-year bond offering, helping to narrow pricing to 7.35% from an initial 7.625% area, according to Informa Global Markets.

 

So if I'm reading this right, Ford Credit was looking for $1.5B, and Wall Street responded with $3.5B in financing?

[hegemony]

I read "tougher credit conditions" as "higher margins on credit and defaulted loan markets expected... so please give us some of your debt Mr. Ford"

[IndyPoolPlayer]

For sure. Interest rates have gone up, but new vehicle pricing has not conversely gone down. Reading elsewhere that used vehicles at Mannheim are sitting on auction lots unsold because they are not meeting selling dealer reserves. Get the water and soap ready because your overleveraged franchise dealerships are about to take a bath.