On Monday, Ford Motor Co . (NYSE: F ) announced a significant financial commitment to its underperforming German division, Ford Werke, with plans to allocate up to €4.4 billion ($4.8 billion) in an effort to reduce the unit’s substantial debt and fund improvements over the next four years, according to Bloomberg News. The move is aimed at addressing the challenges of high operational costs and faltering demand that have plagued the German business.

The US-based automotive giant will utilize the funds to substantially decrease Ford Werke’s current €5 billion debt, as detailed by Managing Director Marcus Wassenberg. This strategic financial maneuver is designed to bring the debt down to more manageable levels, providing a much-needed lifeline to the struggling division.

In addition to debt reduction, Ford is setting aside approximately €500 million to be invested in a comprehensive business-improvement plan. This plan is focused on reviving the German unit’s financial health and steering it back towards profitability. The investment underscores Ford’s commitment to the long-term success of its German operations.

Wassenberg expressed confidence in the parent company’s support, acknowledging that Ford is prepared for the possibility of further losses as the German unit embarks on its path to recovery. He anticipates that Ford’s backing will extend beyond the initial four-year period earmarked for the turnaround effort.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.