Analysis of Liquidity Ratios
Liquidity ratios measure the company ability to meet its short-term obligations.
Paying user area
Try for free
Ford Motor Co. pages available for free this week:
- Income Statement
- Balance Sheet: Assets
- Common-Size Income Statement
- Analysis of Short-term (Operating) Activity Ratios
- Enterprise Value to FCFF (EV/FCFF)
- Price to FCFE (P/FCFE)
- Capital Asset Pricing Model (CAPM)
- Net Profit Margin since 2005
- Return on Assets (ROA) since 2005
- Price to Sales (P/S) since 2005
The data is hidden behind: . Unhide it.
Get full access to the entire website from $10.42/mo, or
get 1-month access to Ford Motor Co. for $24.99.
This is a one-time payment. There is no automatic renewal.
We accept:
Liquidity Ratios (Summary)
Ford Motor Co., liquidity ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Current ratio | ||||||
| Quick ratio | ||||||
| Cash ratio |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Current Ratio
- The current ratio remained stable at 1.2 from 2020 through 2023, suggesting a consistent ability to cover short-term liabilities with current assets during this period. However, in 2024, the ratio experienced a slight decline to 1.16, indicating a marginal decrease in liquidity but still maintaining a level above 1, which generally implies sufficient short-term financial health.
- Quick Ratio
- The quick ratio showed a gradual decreasing trend over the entire period. Starting at 1.05 in 2020, it diminished slightly each year, reaching 0.98 in 2024. This decrease reflects a reduction in the company’s most liquid assets relative to its current liabilities, which may signal a modest decline in the ability to meet short-term obligations without relying on inventory sales.
- Cash Ratio
- The cash ratio exhibited the most pronounced downward trend among the liquidity measures. It rose from 0.51 in 2020 to 0.55 in 2021, marking its peak, then steadily declined each subsequent year to 0.36 in 2024. This reduction indicates a considerable decrease in the company's cash and cash equivalents relative to current liabilities, suggesting a tightening cash position and potentially reduced immediate liquidity.
Current Ratio
Ford Motor Co., current ratio calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current assets | ||||||
| Current liabilities | ||||||
| Liquidity Ratio | ||||||
| Current ratio1 | ||||||
| Benchmarks | ||||||
| Current Ratio, Competitors2 | ||||||
| General Motors Co. | ||||||
| Tesla Inc. | ||||||
| Current Ratio, Sector | ||||||
| Automobiles & Components | ||||||
| Current Ratio, Industry | ||||||
| Consumer Discretionary | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Current ratio = Current assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Current Assets
- The current assets have shown a generally positive trend over the five-year period. Starting at approximately 116.7 billion US dollars at the end of 2020, the value slightly decreased to about 109.0 billion in 2021. Subsequently, it increased steadily year-over-year, reaching around 124.5 billion by the end of 2024. This indicates an overall strengthening in the company's liquid resources available within one year.
- Current Liabilities
- The current liabilities follow a somewhat similar trajectory but with fluctuations. The liabilities decreased from approximately 97.2 billion in 2020 to 90.7 billion in 2021, before rising again to about 106.9 billion in 2024. The upward movement after 2021 suggests increasing short-term obligations, which may reflect higher operational or financial demands.
- Current Ratio
- The current ratio remained stable at 1.2 from 2020 through 2023, indicating a consistent level of short-term liquidity relative to current liabilities. However, by the end of 2024, it slightly declined to 1.16. Although still above 1, this slight decrease suggests a moderately reduced buffer to cover short-term liabilities, which might warrant closer monitoring.
- Overall Analysis
- Overall, both current assets and current liabilities increased over the five-year span, with current assets growing slightly faster. The current ratio’s stability followed by a marginal decline suggests that while the company maintains a reasonable short-term financial position, there may be emerging pressures on liquidity near the most recent period. Continued attention to the balance between liquid assets and short-term obligations would be prudent.
Quick Ratio
Ford Motor Co., quick ratio calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cash and cash equivalents | ||||||
| Marketable securities | ||||||
| Ford Credit finance receivables, net of allowance for credit losses | ||||||
| Trade and other receivables, less allowances | ||||||
| Total quick assets | ||||||
| Current liabilities | ||||||
| Liquidity Ratio | ||||||
| Quick ratio1 | ||||||
| Benchmarks | ||||||
| Quick Ratio, Competitors2 | ||||||
| General Motors Co. | ||||||
| Tesla Inc. | ||||||
| Quick Ratio, Sector | ||||||
| Automobiles & Components | ||||||
| Quick Ratio, Industry | ||||||
| Consumer Discretionary | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Total Quick Assets
- Total quick assets experienced a decline from 102,355 million US dollars in 2020 to 93,506 million US dollars in 2021. Subsequently, there was a recovery, with values increasing to 98,519 million in 2022 and further rising to 102,197 million in 2023. By 2024, total quick assets reached 104,921 million, surpassing the 2020 level. Overall, this indicates a recovery trend after an initial dip, with a gradual accumulation of liquid assets over the period.
- Current Liabilities
- Current liabilities followed a somewhat parallel trend to quick assets. Starting from 97,192 million US dollars in 2020, liabilities decreased to 90,727 million in 2021. However, liabilities increased steadily thereafter, rising to 96,866 million in 2022, 101,531 million in 2023, and reaching 106,859 million in 2024. This reflects a growing short-term obligation burden over the recent years, with liabilities surpassing the initial 2020 level by 2024.
- Quick Ratio
- The quick ratio showed a continuous decline throughout the period. It started at 1.05 in 2020 and decreased gradually each year, reaching 0.98 by 2024. This declining ratio signals a reduction in short-term liquidity, indicating that quick assets are proportionally declining compared to current liabilities. The ratio falling below 1.0 in 2024 suggests a potential liquidity concern, as quick assets are not sufficient to cover current liabilities fully.
- Summary
- The financial data reveals that while the company managed to increase its total quick assets to a level above the 2020 baseline by 2024, current liabilities increased at a faster rate, leading to a deteriorating quick ratio. The consistent decline in the quick ratio to below one highlights increasing short-term liquidity risk. This trend may warrant closer attention to liquidity management and short-term financial obligations to ensure the company can meet its liabilities promptly.
Cash Ratio
Ford Motor Co., cash ratio calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cash and cash equivalents | ||||||
| Marketable securities | ||||||
| Total cash assets | ||||||
| Current liabilities | ||||||
| Liquidity Ratio | ||||||
| Cash ratio1 | ||||||
| Benchmarks | ||||||
| Cash Ratio, Competitors2 | ||||||
| General Motors Co. | ||||||
| Tesla Inc. | ||||||
| Cash Ratio, Sector | ||||||
| Automobiles & Components | ||||||
| Cash Ratio, Industry | ||||||
| Consumer Discretionary | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
The financial data over the five-year period reveals several key trends regarding liquidity and short-term obligations.
- Total Cash Assets
- Total cash assets have shown a consistent decline from 49,961 million US dollars at the end of 2020 to 38,348 million US dollars by the end of 2024. This represents a reduction of approximately 23% over the five-year span, indicating a steady decrease in readily available cash resources.
- Current Liabilities
- Current liabilities exhibit an upward trend, rising from 97,192 million US dollars in 2020 to 106,859 million US dollars in 2024. There is some fluctuation within the period, with a dip in 2021 followed by sustained increases in subsequent years. Overall, this indicates growing short-term financial obligations.
- Cash Ratio
- The cash ratio, which measures the ability to cover current liabilities with cash and cash equivalents, demonstrates a declining pattern from 0.51 in 2020 to 0.36 in 2024. This decline corresponds with the reduction in cash assets and the increase in current liabilities, suggesting a weakening liquidity position over time.
In summary, the company’s liquidity position appears to be deteriorating, marked by decreasing cash reserves and rising current liabilities. The downward trend in the cash ratio points to a potentially increased risk in meeting short-term obligations solely through cash assets. This pattern may warrant closer monitoring and potential strategic adjustments to maintain adequate liquidity.