Toyota's Stellar Credit Rating May Be Downgraded
November 17, 2008
Toyota, the automaker with the best credit in the industry, may see its AAA rating cut by Fitch Ratings due to the "unprecedented challenges" in the economy. It would be the first downgrade for Toyota in a decade.
Fitch said it would review Toyota's rating over the next several weeks. A lower rating raises borrowing costs for a company, which could hamper its ability to offer attractive incentives to boost sales in the U.S., where it reported losing money in the last quarter and saw sales fall to their lowest level since 1983. In Japan, Toyota sales are at their lowest level since 1981. As a result, Toyota has revised its global performance for the year.
Toyota's last rating cut was by Moody's Investors Service in 1998. Moody's isn't revising its rating on Toyota now.
Honda's outlook was also cut to "stable" from "positive," but retains its plus rating. Ratings for Honda and Nissan remain below that of Toyota.
Posted by Michelle Krebs at 12:05 PM under Business , Toyota | Comments (0) | digg this | Seed Newsvine
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