S&P puts Hyundai on negative watchlist amid virus pandemic

SEOUL, April 2 (Yonhap) -- S&P Global Ratings on Thursday placed Hyundai Motor Group on its watchlist of firms with a negative outlook, citing the impact of the new coronavirus pandemic on the global automobile industry.

"The COVID-19 pandemic is causing production suspensions and weakening demand in the global auto industry, which was already facing slowing demand in 2019," S&P said in a report as it placed the South Korean auto giant on "CreditWatch with negative implications," hinting its rating may be lowered.

The conglomerate has Hyundai Motor Co. and Kia Motors Corp. under its wing.

"The pandemic has amplified the challenging demand conditions in the automotive industry," it added.

The agency, however, maintained its rating on the two carmakers, along with their auto parts affiliate, Hyundai Mobis Co., at BBB+ level.

Sales of the two carmakers are expected to fall 15 percent on-year in the United States, with shipments to Europe set to plunge 20 percent over the cited period, it added.

"There is a chance that the impact of the pandemic could be worse than our revised assumptions. The group's key markets of Europe and the U.S. have not yet been able to contain the COVID-19 pandemic," it added.

S&P Global Ratings is a division of New York-based Standard & Poor's Financial Services LLC.

Shares of Hyundai Motor moved up 1.41 percent on the main bourse on Thursday to 86,600 won (US$70.49). Kia Motors advanced 0.98 percent to 25,800 won.

colin@yna.co.kr
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