Ford and Ford Credit Introduce Sustainable Financing Framework Prioritizing Electric Vehicles, Cleaner Production and Community Investments | New
DEARBORN, Michigan – (BUSINESS WIRE) – November 4, 2021–
Ford Motor Company and its financing subsidiary, Ford Motor Credit Company, today unveiled the first sustainable financing framework for the automotive industry in North America, focusing on and funding ambitious plans in the electrification of vehicles. vehicles and other environmental and social fields.
Separately, Ford also today announced a cash tender offer to buy up to $ 5 billion of the company’s higher-cost debt. Actions such as the public offer to purchase debt securities and the issuance of 0% convertible bonds earlier this year, as well as the planned expansion of access to capital under the new sustainable financing framework, are in line with Ford’s goals of further strengthening its balance sheet and financial flexibility and returning its credit ratings to investment grade.
“Winning companies are financially sound and leaders in sustainability – it’s not a choice, they depend on each other,” said John Lawler, Ford chief financial officer. “We’re putting our money back where our mouth is, prioritizing and allocating capital to environmental and social initiatives that are good for people, good for the planet and good for Ford. “
Today’s announcement was made on the fifth anniversary of the Paris Climate Agreement, as Ford executives joined with world leaders, environmental advocates and d ‘other forward-looking companies at the United Nations Climate Change Conference (COP26) in Glasgow, Scotland.
Among other expected benefits, the initiatives outlined in Ford’s sustainable finance framework aim to help the company become carbon neutral by 2050 at the latest, in line with its commitment to the Paris Agreement. Ford was one of the first U.S. automakers to commit to reducing greenhouse gas emissions from its vehicles, operations and supply chain in line with the agreement’s goals. This commitment is supported by scientific milestones that the automaker intends to achieve by 2035.
The potential positive environmental and social influence of the projects described in Ford’s sustainable financing framework received an “advanced” rating – the highest possible – from Vigeo Eiris. Vigeo Eiris, a branch of Moody’s Corp., conducts independent assessments of the objectives and performance of organizations with respect to environmental, social and governance issues.
Guided by aggressive environmental and social goals, a significant portion of the related funding will go to accelerate Ford’s leadership in electric vehicles. Goals include expanding EV technology and charging infrastructure to remove barriers to adoption and improve the customer experience, and manufacturing EVs and batteries to reduce emissions.
“We will build high quality electric vehicles on a large scale and do so in a way that positively impacts people and the environment,” said Bob Holycross, Ford vice president, Sustainability, Environment and Safety Engineering. “In communities where air pollution and climate change are disproportionate burdens today, access to electric vehicles may have the added benefit of moving people to the front lines for health benefits, l economy and mobility that these vehicles can offer. “
How Ford’s Sustainable Financing Framework Works
The framework will cover a variety of unsecured finance and securitization transactions, including ESG bonds issued by Ford and Ford Credit to finance environmental and social projects, and how Ford’s electrification and mobility projects will be assessed. and selected. The framework will also govern how the product will be managed and how Ford and Ford Credit will report for results. Funds will be fully allocated within 24 months of each sustainable finance issue.
The net proceeds of sustainable finance will be invested and spent in four areas:
- Clean transport – Design, develop and manufacture zero emission transport, focusing on battery electric vehicles and the batteries that power them across the range of design, development, manufacture and end of life. Examples include Ford’s recent announcement the largest US investment in electric vehicles at one point by an automaker, with SK Innovation, in new mega-sites in Tennessee and Kentucky; collaboration with Redwood Materials on recycling options for waste, end-of-life electric vehicles and lithium-ion batteries; and offer financing products and wholesale loans to establish or improve electric vehicle charging infrastructure.
- Own production – Further reduce the environmental footprint of Ford’s operations through renewable energy, sustainable water and wastewater management, waste management and energy efficient buildings. For example, Ford’s new advanced campuses in Tennessee and Kentucky will be designed to have as little impact as possible – and even to generate beneficial effects – on the surrounding environment.
- Improve life – Promote economic opportunities and equity for under-represented and / or disadvantaged populations through projects aimed at expanding the diversity networks of Ford suppliers and dealers. The aim is to create programs and opportunities for minority-owned businesses, women, veterans and people with disabilities, and for community businesses and women-focused social businesses that promote better health, develop essential skills and support maternal and child health, education and disability support services.
- Community revitalization – Support and empower disadvantaged communities by creating and renovating spaces to provide employment opportunities and access to essential services. One such project is Ford’s investment in the redevelopment of historic Michigan Central Station and surrounding areas to create a new mobility innovation district in the Corktown neighborhood of Detroit. The project brings together diverse thinkers and actors to help solve complex community challenges and improve access and equity for all.
Ford’s sustainable finance framework aligns with its ambitious sustainability goals, as well as environmental and social principles and best practices established by the International Capital Market Association and the Loan Market Association. These groups advise on transparency, disclosure, impact measurement and external reviews in sustainable finance.
In addition to the external audit, a new sustainable finance committee established within Ford will ensure that funded projects comply with Ford’s strategic corporate social responsibility plan and otherwise meet eligibility criteria. The committee includes high-level representatives from Treasury, Sustainability, Corporate Finance, Investor Relations, Ford Credit and the Legal Department.
Committed to a sustainable future
Ford’s extensive support and leadership at COP26 will include joining other signatories to the ambitious RouteZero initiative. Led by the international non-profit Climate Group and high-level United Nations climate champions, RouteZero aims to reduce the carbon associated with road transport. More than 50 companies, cities and regions have pledged to work together to achieve 100% zero-emission cars and vans globally by 2040, and in major markets by 2035 at the latest.
Additionally, Ford’s Holycross will address high-level business representatives, financiers, government officials, policy makers, innovators, academics and environmental influencers at the World Climate Summit: the COP on investment on November 7. The event is a premier forum for businesses. and investment-driven solutions to climate change convened by the Global Climate Foundation. In his remarks, Holycross will focus on Ford’s substantial sustainability achievements to date and how the company is focused on driving the large-scale electric revolution.
About Ford Motor Company
Ford Motor Company (NYSE: F) is a global company based in Dearborn, Michigan, committed to helping build a better world, where everyone is free to move around and pursue their dreams. The company’s Ford + plan for growth and value creation combines existing strengths, new capabilities and ongoing relationships with customers to enrich customer experiences and build loyalty. Ford designs, manufactures, markets and services a full line of connected and increasingly electrified passenger and utility vehicles: Ford trucks, utility vehicles, vans and cars, and Lincoln luxury vehicles. The company pursues leadership positions in electrification, connected vehicle services and mobility solutions, including autonomous driving technology, and provides financial services through Ford Motor Credit Company. Ford employs approximately 184,000 people worldwide. More information about the company, its products and Ford Motor Credit Company can be found atcompany.ford.com.
For press releases, related materials, and high-resolution photos and videos, visit www.media.ford.com.
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SOURCE: Ford Motor Company
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PUB: 04/11/2021 08:30 / DISC: 04/11/2021 08:32