S&P lowers Hyundai, Kia

S&P said it lowered the issuer credit ratings on Hyundai Motor Co., Kia Motors Corp. and Hyundai Mobis Co. Ltd. to BBB+ from A-.

The outlooks are stable.

At the same time, the agency changed the outlook on Hyundai Glovis Co. Ltd. to stable from positive and affirmed the BBB+ long-term issuer credit rating.

“We lowered the ratings on HMC and Kia to reflect our view that the companies' weakened profitability is unlikely to notably reverse over the next 12-24 months,” S&P said in a news release.

“HMC's (including Kia and excluding finance subsidiaries) EBITDA margin is likely to remain at about 6% in 2018-2019, compared with 8.3% in 2016 and 9.0% in 2015, mainly due to intense competition in the U.S. and China auto markets, the company's challenged market position, and slowing growth in demand for automobiles.”

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