S&P puts Hayes Lemmerz on watch

Standard & Poor's said it placed its B- corporate credit rating on Hayes Lemmerz International Inc. on CreditWatch with negative implications.

The agency said that the CreditWatch placement follows Ford Motor Co.'s announcement that it will sharply lower vehicle production in the second half of 2006, with the largest cuts coming in the fourth quarter.

S&P noted that the company has reported weak results during the past few years because of the difficult industry conditions facing automotive suppliers, including high raw-material costs, customer market-share shifts, product-mix changes and pricing pressure.

The announcement by Ford will further depress Hayes' earnings and cash flow and could create near-term liquidity pressures for the company, the agency added.

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