Moody’s drops Daimler

Moody's Investors Service said it downgraded Daimler AG's long-term ratings to A3 from A2 and its short-term ratings to Prime-2 from Prime-1.

The outlook remains negative.

“The downgrade to A3 was triggered by Daimler's significantly reduced guidance for its earnings outlook for the period 2020-2022 that will be further burdened by restructuring provisions and cash needs for the planned redundancy programme over the same period,” Falk Frey, Moody’s senior vice president and lead analyst for Daimler, said in a news release.

“Low visibility and predictability about the future share of plug-in hybrid- and pure battery electric vehicles with lower margins than current combustion engine powered cars and a potential decline in light vehicles demand in North America, Europe or China could further delay a recovery in Daimler's credit metrics which is reflected in the negative outlook.”

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