Hot News
for your iPhone
for your iPad
Go to our forums to discuss this news
DATE News (chronologically)
News gets worse for auto manufacturers
Fitch Ratings downgraded Ford Motor Co.'s credit rating deeper into junk status Monday as economic worries dragged down auto shares along with stock markets around the globe.

The credit rating agency said it reduced the issuer default rating one notch to "CCC" from "B-" for both Ford and its finance arm, Ford Motor Credit Co. Both ratings are noninvestment, or junk, grade. Fitch analyst Mark Oline said the growing impact of the credit crisis on auto sales, supply chain financial risks, the financial health of dealerships and the capital advantage of its Asian competitors were all factors in the downgrade.

Meanwhile Toyota Motor Corp. fell to the lowest in more than four years in Tokyo, losing its spot as the world's largest automaker by value to Volkswagen AG amid rising concerns that global growth is slowing following the collapse of the U.S. mortgage market.

Toyota declined 4.9 percent to 3,710 yen, the lowest since March 2004, at the 3 p.m. close on the Tokyo Stock Exchange, giving it a giving it a market capitalization of $124.3 billion. Wolfsburg, Germany-based Volkswagen's value was $127.5 billion at today's exchange rate.

Toyota's sales in the U.S., the world's largest auto market, have plunged this year as higher fuel costs have cut demand for Tundra pickups and Sequoia sport-utility vehicles. Volkswagen's shares have gained 87 percent this year as Porsche SE bid for a majority stake and hedge funds that had bet on the shares falling were forced to close their positions.

``The auto industry is in a difficult situation right now,'' said Edwin Merner, president of Atlantis Investment Research Corp. in Tokyo, whose parent company manages about $3.1 billion. ``Toyota is well positioned to survive, but it will suffer like all the others.''

U.S. sales at Toyota plummeted 32 percent in September, the biggest such decline since 1987. Toyota is halting production of Tundras and Sequoias for three months from August. The carmaker reduced its North American sales forecast for 2009 to 2.7 million vehicles from 3 million, it said on Aug. 28.

Hot News Archives
2000 2001 2002 2003

Search Hot News
Search Help
AutoRacing1 Inc. BBB Business Review