Ford Targets Fixed Income to Reduce Pension Asset Volatility

22 February 2012 (PLANSPONSOREurope.com) - Ford in the UK is targeting fixed income asset allocation to help minimise volatility of the value of its pension assets to pension liabilities and to ensure assets can pay plan benefits, according to the car giant’s annual report.

The move would see Ford’s UK pension plan follow the investment objectives of its US and Canadian plans.

The group says previous target asset allocations for the UK were 45% fixed income investments, 30% public equity investments, and up to 25% alternative investments. It adds that Ford UK has “similar” investment objectives to US plans which now has target asset allocations of 80% fixed income and 20% growth assets (primarily alternative investments, which include hedge funds, real estate, private equity, and public equity).

The report adds Ford expects to reach these target asset allocations over the next several years.

Ford also announced it is putting $3.8bn into global pension plans this year.

PLANSPONSOREurope Staff
editors@plansponsoreurope.com