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Moody's may downgrade Toyota
Moody's Investors Service said it placed the Aa1 senior unsecured long-term rating of Toyota Motor Corp. and its supported subsidiaries under review for possible downgrade. The company's prime-1 short-term rating is not affected by the review.
The ratings affected are for Toyota Motor Corp., Toyota Financial Services Corp., Toyota Motor Credit Corp., Toyota Finance Australia Ltd., Toyota Credit Canada Inc., Toyota Motor Finance (Netherlands) BV, Toyota Finance Corp., Toyota Finance New Zealand Ltd., Toyota Kreditbank GmbH and Toyota Financial Services (South Africa) Pty Ltd.
The downgrade review is prompted by a concern that the growing scale of Toyota's product problems and associated recalls may have longer term impacts on its brand equity, pricing power and market share in key markets, Moody's said.
This raises significant risk that the recovery in the company's earnings may not continue or will be at a much slower pace than originally contemplated, the agency said.
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