Bangkok--27 Mar--Fitch Ratings
Fitch Ratings (Thailand) Limited has today changed the rating Outlook on Mercedes-Benz (Thailand) Limited’s (MBTh) THB2.5bn guaranteed debentures due 2009 to Negative from Stable. This follows a similar revision in Outlook on Germany’s Daimler AG (Daimler), the guarantor and its parent. At the same time, the National Long-term rating on the debentures has been affirmed at ‘AA(tha)’. The rating is based entirely on the full, irrevocable and unconditional guarantee provided by Daimler.
The rating Outlook on Daimler was revised to reflect Fitch's revised forecasts for European car manufacturers and expectations for industry growth over the next two years. These, in turn, are driven by the agency's macro-economic assumptions for economic growth in 2009 and 2010. Fitch is increasingly concerned about the extent of manufacturers' falling profitability and the potential for accelerated cash consumption in the next two years, as well as the consequent potential for heightened volatility in financial metrics. While Fitch has employed conservative forecasts, the distribution of possible outcomes for revenues and operating cash flow is still biased towards the downside.
Contacts: Lertchai Kochareonrattanakul, Ekapan Prompraphant, Vincent Milton, Bangkok, +662 655 4755; Emmanuel Bulle, Paris, +33 1 44 29 91 84.