AppId is over the quota
AppId is over the quota
By AutoObserver Staff September 21, 2011
Moody’s Investor’s Service said today it is downgrading the debt of Italy’s Fiat S.p.A. by one level to Moody’s Ba2, now placing debt held in the Italian automaker and majority shareholder of the Chrysler Group LLC two levels below investment grade. Moody’s cited concern that the recent integration of Chrysler and Fiat (Fiat acquired majority ownership of Chrysler in July) could force the companies to support one another “in the event of financial difficulty.”
Fiat has lost almost a full point of market share in Europe so far this year and Moody’s expressed concern about the speediness of Fiat’s model-refreshment schedules. The investment-rating service also said it is worried that Fiat is responsible for Chrysler’s debt, which is rated three levels below Fiat’s. Fiat CEO Sergio Marchionne said last week, however, that he sees no need to hurry in merging Fiat and Chrysler and did not want to risk a downgrade of Fiat’s debt in order to absorb Chrysler. Marchionne also said he did not expect Fiat, which currently is losing money, to break even operationally until 2014.
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