DETROIT – Ford MotorIt plans to buy up to $5 billion in high-yield debts as part of a larger plan to restructure the balance sheet. This was due to its increased need for emergency borrowings after automakers shut down operations last year.

Ford has purchased back a large portion of the bond issue by the company at the outset, which was $8 billion. coronavirus pandemicFord Treasurer Dave Webb said that the high yields range from 8.5% to 9.625%. The company plans to repurchase older bonds of similar yields, in the hopes that it can improve its credit rating. It lost its investment grade status in March 2020.

Ford anticipates that the cash available to finance the buyback, which was $31 billion at the end of the third quarter, will be sufficient. Webb said a $1 billion or more “green” bondIt could also be part of larger effort to “aggressively restructuring” its balance sheets under its Ford+ turnaround plan.According to him, the company plans on issuing 10-year bonds with a yield of between 3.5% and 4.5%.

We believe it is the right time to aggressively restructure our balance sheet, reduce our interest costs and clear the decks in 2022 and beyond. Webb stated that this is what they are trying to achieve during a conference call.

Ford announced the repurchase as part of their new sustainable financing framework, which it calls a “first of its kind” for North American automakers. This framework will concentrate on vehicle electrification, as well other areas of environmental and social concern such as community revitalization or clean manufacturing.

This is a significant shift in Ford’s financial operations, which includes Ford Credit. ESG investing, also known as ESG or environmental, social, and governance (ESG) becomes more common and considered by investors.

Bond repurchases and a new framework will be used to help finance Ford+, which includes investing in electric and autonomous vehicles technologies for tens and billions.

Webb refused to speculate about when the automaker will return to investment-grade. Webb said that they are “intense to get there as soon as possible.”

“The actions taken here on our balance sheet support this effort and intention.” Webb indicated that we believe they are credit positives.