Fitch rates Hyundai Motor BBB-

Fitch Ratings said it assigned Hyundai Motor Co. a BBB- long-term foreign-currency issuer default rating, F3 short-term rating and senior unsecured debt rating of BBB-.

The outlook is stable.

The ratings reflect Hyundai's dominant position in South Korea's automobile market, a growing presence overseas and good operating performance, Fitch said. Credit metrics, although damaged by a loss at the financial services subsidiaries between 2003 and 2004, has remained robust with the operating EBITDAR margin at 8.2%, the agency said. The ratings also take into account the substantially reduced risks associated with Hyundai Capital Services and Hyundai Card Co., Ltd., Fitch added.

The agency noted, however, as the parent company of a business conglomerate with a complex cross-shareholding ownership structure, Hyundai remains exposed to possible contagion risk. Credit concerns also include its heavy exposure to the foreign-exchange risk arising from a high export ratio and a concentration of production facilities in South Korea, the agency said.

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