US 'probably' in a recession: Former Ford CEO
Detroit automakers have closed factories, idling 150,000 workers
The U.S. is "probably" in a recession as the auto, airline and other industries take hits due to the coronavirus pandemic, former Ford CEO Mark Fields told "Mornings with Maria" on Thursday.
"We probably are in one right now. ... I think it will tell us that in the last week or two we've started to contract from a GDP standpoint," Fields said.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| F | FORD MOTOR CO. | 11.13 | +0.03 | +0.27% |
| FCA | FIRST TR EXCH TRADED ALPHADEX FD II CHINA ALPHADEX FD | 19.77 | +0.04 | +0.20% |
| GM | GENERAL MOTORS CO. | 55.59 | +0.09 | +0.16% |
He said some recession factors, like the Federal Reserve aggressively tightening monetary policy and market imbalances, are missing. But the coronavirus pandemic counts as an "exogenous shock" that could point to a major downturn.
AUTOMAKERS AGREE ON CORONAVIRUS MEASURES TO KEEP PLANTS RUNNING
Detroit's three automakers have agreed to partial factory shutdowns, deep cleaning of equipment and longer periods between shifts to head off union demands for U.S. plant closures.
Former Ford Motors CEO Mark Fields visits "Maria Bartiromo's Wall Street" at Fox Business Network Studios on October 24, 2019 in New York City. (Photo by John Lamparski/Getty Images)
"I think first and foremost it was about keeping workers safe, and secondly there is no sense in building cars and trucks if you don't know what market is going to be," Fields said.
The agreements came after union officials spoke individually with General Motors, Ford and Fiat Chrysler. The companies also agreed to “extensive plans” to avoid union members coming in contact with one another, the United Auto Workers union said in a statement.
Fields was optimistic about the state of the Detroit automakers in 2020 compared to the Great Recession, explaining that they are in a "much stronger financial position."
"GM, Ford have liquidity of about $34, $35 billion," Fields said. "I think FCA has a little over $16 billion, and on any given month for let's say GM and Ford, you need about four billion dollars to keep the lights on, to keep paying people, so clearly they are coming from a balance sheet that has a lot of strength."
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The Associated Press contributed to this report.