Detroit's two biggest carmakers suffered further humiliation yesterday when a third credit ratings agency downgraded their bonds to junk status.
Moody's joined Standard & Poor's and Fitch in slapping Bminus ratings on General Motors and Ford.
It cut GM's bonds by two notches to Ba2 and Ford's by one level to Ba1.
Moody's also downgraded Ford's finance arm but left it at investment grade status.
Most of Ford's debt is held at its finance arm, Ford Motor Credit.
Ford and Ford Motor Credit are among the biggest bond issuers in the US with about $158 billion (£88 billion) of debt.
Strong competition, soaring health care and raw material costs and a slide in US market share have sent both GM and Ford spiralling down into the red this year.
The latest downgrading of their bonds will make life much harder for the two groups, once rated the bluest of America's blue chip corporations.
It makes it more expensive for them to issue debt because junk bonds need higher coupons in order to find buyers. Also, fund managers whose rules dictate they hold only investment grade bonds will be forced to sell their GM and
Ford holdings, sending the price down.
Both companies said they were d i s a p --pointed by the Moody's downgrade but were pressing on with plans to turn their businesses around by slashing costs.
"Although the decision Moody's made is disappointing, it doesn't shake our determination to achieve continued success as a global automaker," Don Leclair, Ford's chief financial officer, said.