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Getting an upgrade from a second agency may take some time. S&P and Moody's raised Ford's ratings to one notch below investment grade in October after the automaker signed a new labor agreement that holds labor costs steady through 2015. But S&P analysts said last month that they didn't expect another ratings change within the next year. S&P has a stable credit outlook on Ford, which means the company has less than a one-third chance of getting a rating change in either direction, S&P credit analyst Robert Schulz said Tuesday. U.S. auto sales are recovering well and Ford's performance in North America has been solid, Schulz said. But he added that "the rest of the world is a more open question." Ford still faces risks, including how it plans to deal with sales declines and large losses in Europe, and whether its massive China expansion plan will work, he said. Moody's, in its most recent analysis of the company, also questions whether Ford could sustain an investment-grade rating. Fitch's outlook for Ford is stable. The agency also noted risks, including the strength and pace of the global economic recovery and the demand for automobiles, especially as Western Europe heads into recession. But Fitch said the company's net cash of $10 billion at the end of last year and other sources of cash should give it enough money to endure a severe sales downturn. Ford can break even at a lower sales volume because of its restructuring, and it now has the right mix of both small and large vehicles. Ford's products used to tilt more heavily toward trucks and SUVs. "Ford's more balanced product portfolio has put it in a better position to weather the likely mix shifts to smaller vehicles typically seen in economic downturns," Fitch said.
[Associated
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