(Reuters) - Fitch Ratings upgraded Ford Motor Co (F.N) to investment grade on Tuesday, marking a key step that brings the second-largest U.S. automaker closer to reclaiming its Blue Oval trademark.
Fitch upgraded Ford and its captive finance arm to "BBB-" from "BB+" to reflect the improvement in Ford's finances since its near collapse in 2006. Ford has lowered its break-even point since the last recession and improved its vehicle lineup.
Still, the agency said Ford also faced the risk of slower-than-expected global demand for vehicles, particularly in Europe.
"Fitch believes that the work that has been accomplished has put the company in a solid position to withstand the significant cyclical and secular pressures faced by the global auto industry," the credit ratings agency said in a release.
As part of its turnaround, Ford borrowed more than $23 billion in late 2006 secured by most of Ford's assets, including the Blue Oval logo. Should one more agency upgrade Ford to investment grade, the collateral underpinning those loans would be released.