S&P Assigns Pi Ratings to Japanese Automakers.TOKYO--(BUSINESS WIRE)--Standard & Poor's CreditWire 12/1/97-- Standard & Poor's today assigned ratings based on public information, or 'pi' ratings, to Japanese automotive producers Mitsubishi Motors Mitsubishi Motors Corporation (三菱自動車工業株式会社 Corp. and Suzuki Motor Corp. At the same time, Standard & Poor's affirmed af·firm v. af·firmed, af·firm·ing, af·firms v.tr. 1. To declare positively or firmly; maintain to be true. 2. To support or uphold the validity of; confirm. v.intr. the existing ratings on Toyota Motor Corp., Nissan Motor Co. Ltd., and Honda Motor Co. Ltd. (see rationales and ratings below). Standard & Poor's views the credit profile of the Japanese automotive industry The automotive industry is the industry involved in the design, development, manufacture, marketing, and sale of motor vehicles. In 2006, more than 69 million motor vehicles, including cars and commercial vehicles were produced worldwide. as "slightly above average," reflecting its high productivity, economies of scale in production, market diversity, and superb technology. Limiting factors A factor or condition that, either temporarily or permanently, impedes mission accomplishment. Illustrative examples are transportation network deficiencies, lack of in-place facilities, malpositioned forces or materiel, extreme climatic conditions, distance, transit or overflight rights, include mature demand in the Japanese market, intensifying competition in overseas markets, and vulnerability to foreign exchange fluctuations. Differentiation in the assigned ratings, which range from 'AAA' to 'BBB', reflects variations in the automakers' competitive positions in major markets and financial profiles. The ratings take into account softening demand in the Japanese auto market, where total sales began to decline from this April. For the fiscal year ending March 31, 1998, total auto sales Auto Sales The major producers of domestic automobiles report sales monthly. These numbers are seasonally adjusted by the U.S. Department of Commerce and are available to the public one to five business days after the end of each month. , excluding sales of minicars, are expected to decrease to 4.9 million to 5 million units. Success in the short term amid this difficult operating environment In computing, an operating environment is the environment in which users run programs, whether in a command line interface, such as in MS-DOS or the Unix shell, or in a graphical user interface, such as in the Macintosh operating system. will hinge on Verb 1. hinge on - be contingent on; "The outcomes rides on the results of the election"; "Your grade will depends on your homework" depend on, depend upon, devolve on, hinge upon, turn on, ride product strategy and the financial strength to withstand ongoing price pressures. Currency devaluations Currency devaluation A deliberate downward adjustment in the official exchange rates established, or pegged, by a government against a specified standard, such as another currency or gold. in Southeast Asia Southeast Asia, region of Asia (1990 est. pop. 442,500,000), c.1,740,000 sq mi (4,506,600 sq km), bounded roughly by the Indian subcontinent on the west, China on the north, and the Pacific Ocean on the east. and the resulting economic turmoil has cast a shadow on Japanese auto and motorcycle producers, which have a significant presence in the region. On the other hand, Japanese automakers benefit from robust export sales thanks to the recent depreciation of the yen. Overall gains in market share in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. and Europe, however, have been limited. How each industry participant tackles its problems in these major markets will be a significant determinant determinant, a polynomial expression that is inherent in the entries of a square matrix. The size n of the square matrix, as determined from the number of entries in any row or column, is called the order of the determinant. of future credit quality. Mitsubishi Motors Corp. New: Corporate credit rating: Local currency BBBpi The rating reflects Mitsubishi Motor Corp.'s position as one of Japan's largest automotive manufacturers, its well-diversified product portfolio in passenger and commercial vehicles, and its affiliation with the Mitsubishi group. The rating also reflects the company's aggressive debt usage and heavy planned capital spending capital spending Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. . Concerns exist over the company's weakening competitiveness in the sport-utility segment, which has led to significant declines in domestic share over the past year. The company's substantial exposure to the Thai automotive market, where production and sales have recently declined drastically amid the country's economic turmoil, will hurt profitability in the near term. The company's already aggressive level of net debt leverage, at approximately 76.%, is expected to rise by the end of fiscal 1997 (ending March 31, 1998). Suzuki Motor Corp. New: Corporate credit rating: Local currency Api The rating reflects Suzuki Motor Corp.'s conservative financial profile, with very low debt leverage, its leading market position in Japan's unique minicar min·i·car n. A very small car, especially a subcompact. Noun 1. minicar - a car that is even smaller than a subcompact car market, and its position as the world's third-largest producer of motorcycles. Suzuki has maintained a solid position in the Japanese minicar market for two decades, thanks to a low cost structure and a strong distributor network, though this position is vulnerable to future changes in regulatory standards. Capital needs are expected to remain high owing to owing to prep. Because of; on account of: I couldn't attend, owing to illness. owing to prep → debido a, por causa de investments overseas and the next revision of minicar regulatory specifications in 1998. Stable and adequate cash flow, however, should mitigate the impact on capital structure. Suzuki will likely be able to maintain its very conservative debt leverage, at 28% after netting cash equivalents, over the near term, Standard & Poor's said. ---CreditWire. -0- RATINGS AFFIRMED Honda Motor Co.,Ltd. Corp credit rtg A-/Positive/A-2 CP A-2 American Honda Finance Corp. Corp credit rtg A-/Positive/A-2 CP A-2 Sr unsecd A- American Honda Motor Co. Inc. Corp credit rtg --/--/A-2 CP A-2 Honda Finance Europe PLC Corp credit rtg A-2 CP A-2 Nissan Motor Co. Ltd. Corp credit rtg BBB/Negative/A-2 CP A-2 Sr unsecd BBB Nissan Motor Acceptance Corp. Corp credit rtg BBB/Negative/-- Sr unsecd BBB Nissan International Finance (Netherlands) B.V. Corp credit rtg BBB/Negative/A-2 CP A-2 Sr unsecd BBB Nissan Motor Corp. of USA Corp credit rtg BBB/Negative/A-2 CP A-2 Sr unsecd BBB Nissan Capital of America Inc. Corp credit rtg BBB/Negative/A-2 CP A-2 Sr unsecd BBB Toyota Motor Corp. Corp credit rtg AAA/Stable/A-1+ CP A-1+ Sr unsecd AAA Toyota Motor Sales USA Inc. Corp credit rtg AAA/Stable/A-1+ CP A-1+ Sr unsecd AAA Toyota Motor Credit Corp. Corp credit rtg AAA/Stable/A-1+ CP A-1+ Sr unsecd AAA Toyota Motor Finance (Netherlands) B.V. Corp credit rtg AAA/Stable/A-1+ CP A-1+ Sr unsecd AAA Toyota Deutschland GmbH CP A-1+ CONTACT: Hideki Goto, Tokyo (81) 3-3593-8717 Scott Sprinzen, New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of (1) 212-208-1667 For more information on criteria or subscriptions: http://www.ratings.standardpoor.com |
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