GM, Ford Downgraded By S&P

Autoparts Report, Feb 23, 2001

General Motors and Ford, faced with a slowing U.S. economy, have been downgraded by Standard & Poor's. The credit rating company revised its outlook on General Motors Co. and Ford Motor Co. to negative from stable, citing "heightened concerns" about their ability to compete.

The companies have nearly $300 billion of debt on the market. Rivals have been bringing out new sport-utility vehicles, light trucks and other big-ticket vehicles, making GM and Ford work harder to defend their most profitable markets. Detroit-based GM's ratings could fall "within the next year," and Dearborn, Mich.-based Ford's "within the next few years," if they don't address their problems and keep their financial flexibility, said S&P's auto ratings team.