Investors swarmed over Ford Motor Co.’s new $1.75 billion green-bond deal on Tuesday to help boost its development of more electric vehicles. Order books for Ford’s
F,
+0.67%
speculative-grade debt deal reached more than $5 billion, according to a portfolio manager and Informa Global Markets, which helped the auto giant achieve cheaper funding than initially expected.
The bond deal came the same day President Joe Biden signed the Inflation Reduction Act into law, a smaller version of the earlier Build Back Better proposal, which includes an up to $7,500 credit for qualifying electric vehicles if the assembly is finalized in North America. Ford said in a public filing Tuesday that proceeds from the bond financing will aim to fund clean-transportation projects, including the design, development and manufacturing of electric vehicles in North America. This includes next-generation electric F-150 pickups, future Lincoln vehicles and other vehicles that have yet to be announced. Ford didn’t immediately respond to a request for comment. Its single 10-year class of green bonds, rated Ba2 by Moody’s Investors Service and BB+ by S&P Global, fetched 6.1%, according to Informa. Initial talk was in the 6.375% range, CreditSights said. That compares with the yield on the ICE BofA US High Yield Index narrowing to about 7.2% this week from a peak of 8.8% in July, after the junk-bond market staged a record rally in recent weeks.EV tax credit In conjunction with the act’s signing, the U.S. Treasury Department on Tuesday released a two-page fact sheet and related guidance on how the law can make electric vehicles more affordable for households, i …