TOKYO (Reuters) – S&P Global Ratings on Tuesday downgraded Nissan Motor’s rating to junk, as the ratings agency said earnings at the Japanese carmaker, a Renault partner, will remain weaker than initially expected. in view of another difficult year.
In a press release, S&P said it had reduced Nissan’s long-term financial rating by one notch, from “BBB-” to “BB+”, which puts the manufacturer in the category of speculative investments.
“The company’s performance has been weak for more than three years,” S&P said, adding that the impact of disruptions in the global supply chain for leading auto components would likely continue into 2023.
“In addition, during the second half of the year, we expect the slowdown in demand for new cars in the United States and Europe to put pressure on sales prices,” continues S&P.
S&P, however, gave Nissan’s financial rating a stable outlook, with limited downside risk to profitability and guidance as the automaker is expected to maintain financial discipline and a healthy balance sheet.
(Report Daniel Leussink; French version Claude Chendjou, edited by Kate Entringer)
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