COVID-19 Leads To Downgrade Of Auto Supplier ZF; Schaeffler And Valeo Ratings Put On Watch Negative - S&P Global Ratings’ Credit Research

COVID-19 Leads To Downgrade Of Auto Supplier ZF; Schaeffler And Valeo Ratings Put On Watch Negative

COVID-19 Leads To Downgrade Of Auto Supplier ZF; Schaeffler And Valeo Ratings Put On Watch Negative - S&P Global Ratings’ Credit Research
COVID-19 Leads To Downgrade Of Auto Supplier ZF; Schaeffler And Valeo Ratings Put On Watch Negative
Published Apr 03, 2020
5 pages (2623 words) — Published Apr 03, 2020
Price US$ 150.00  |  Buy this Report Now

About This Report

  
Abstract:

Under our base case, the COVID-19 pandemic will result in a 15% decline in global auto demand, and automakers' production will be realigned accordingly, leading to intense pressure on auto suppliers in 2020. The duration and severity of social distancing measures to rein in contagion risk in Europe and the U.S., and uncertainty regarding the path to recovery will weigh heavily on the cash flow and earnings of auto suppliers. We are lowering our ratings on ZF Friedrichshafen and its debt to 'BB+' from 'BBB-', while placing our 'BBB-' ratings on Schaeffler AG and Valeo S.A. and their respective debt instruments on CreditWatch with negative implications. The negative outlook on ZF reflects risks linked to the duration of the COVID-19

  
Brief Excerpt:

...- Under our base case, the COVID-19 pandemic will result in a 15% decline in global auto demand, and automakers' production will be realigned accordingly, leading to intense pressure on auto suppliers in 2020. - The duration and severity of social distancing measures to rein in contagion risk in Europe and the U.S., and uncertainty regarding the path to recovery will weigh heavily on the cash flow and earnings of auto suppliers. - We are lowering our ratings on ZF Friedrichshafen and its debt to '##+' from '###-', while placing our '###-' ratings on Schaeffler AG and Valeo S.A. and their respective debt instruments on CreditWatch with negative implications. - The negative outlook on ZF reflects risks linked to the duration of the COVID-19 pandemic and its impact on the global auto supplier industry. - We expect to resolve the CreditWatch placements on Schaeffler and Valeo in the second quarter of 2020, when we should have additional information about the impact of the COVID-19 pandemic...

  
Report Type:

Ratings Action

Issuer
ZF Friedrichshafen AG
GICS
Auto Parts & Equipment (25101010)
Sector
Global Issuers
Country
Germany
Region
Europe, Middle East, Africa
Format:
PDF Adobe Acrobat
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Cite this Report

  
MLA:
S&P Global Ratings’ Credit Research. "COVID-19 Leads To Downgrade Of Auto Supplier ZF; Schaeffler And Valeo Ratings Put On Watch Negative" Apr 03, 2020. Alacra Store. May 06, 2025. <http://www.alacrastore.com/s-and-p-credit-research/COVID-19-Leads-To-Downgrade-Of-Auto-Supplier-ZF-Schaeffler-And-Valeo-Ratings-Put-On-Watch-Negative-2416669>
  
APA:
S&P Global Ratings’ Credit Research. (). COVID-19 Leads To Downgrade Of Auto Supplier ZF; Schaeffler And Valeo Ratings Put On Watch Negative Apr 03, 2020. New York, NY: Alacra Store. Retrieved May 06, 2025 from <http://www.alacrastore.com/s-and-p-credit-research/COVID-19-Leads-To-Downgrade-Of-Auto-Supplier-ZF-Schaeffler-And-Valeo-Ratings-Put-On-Watch-Negative-2416669>
  
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