At the same time, Ford Motor is also trying to catch up with General Motor by boosting the production and sale of its large SUVs.
According to a filing with the U.S. SEC, Ford Motor Co is set to raise $2.8 billion in long term debt to help fund new technologies for its self-driving vehicle.
Joe Hinrichs, the president of the Ford for the Americas region, said the funds would largely go for investment in new technology including self-driving vehicles, electric vehicles, and mobility efforts such as ride-hailing and ride-sharing.
“It’s an opportunistic time,” said Hinrichs. “It’s a supportive marketplace for long-term debt given where rates are, and we want to make sure that throughout the cycle of the industry we have the flexibility to do what we need to do and want to do, especially in the emerging part of the business.”
Ford made the filing with the SEC stating it plans on raising $1.5 billion with a debt instrument having a validity of 10 years, with a yield maturity of 4.356%.
Similarly, it also plans on raising $1.3 billion with a 30-year notes which will have a yield maturity of 5.291%.
Hinrichs also mentioned that the company has the manufacturing flexibility to produce more numbers of Lincoln Navigator and the Ford Expedition SUVs. However he did not disclose as to how many models he hoped sell.
“Suffice to say it is a big opportunity for us,” said Hinrichs in reference to the newer versions of the large SUVs.
In recent years, General Motors has dominated the large SUV segment despite the fact that Ford created the segment two decades ago. However, sales of Ford’s big SUVs are on the rise: its large SUV sales have jumped by 33%, while General Motors’ sale statistics in this segment has risen by only 18%.
However, with Donald Trump wanting to revisit the North American Free Trade Agreement, it is too early to say how the tweaking of the agreement will impact its sales.