S&P Downgrades Navistar’s Credit Rating
Standard & Poor’s Rating Services has downgraded Navistar International Corp.’s long-term credit rating, voicing “increased skepticism” toward the truck and engine maker’s efforts to rebuild market share, but two other credit rating firms stood pat with their current assessments.
S&P lowered Navistar’s rating to CCC+, from B- on Oct. 7, adding that it sees Navistar’s business risk profile as “vulnerable” and its financial risk profile as “highly leveraged.”
“The rating downgrades reflect our increased skepticism regarding Navistar’s prospects for achieving the market shares it needs for a successful business turnaround,” S&P credit analyst Sol Samson said in the statement.
On the same day, however, Moody’s Investors Service affirmed its “B3”corporate family rating for Navistar, and Fitch Ratings maintained its “CCC” issuer default rating for the company.
Navistar spokeswoman Elissa Maurer pointed to the company’s September order intake as evidence of its “positive momentum” in regaining market share.
A day after S&P’s rating change, Navistar announced that it received nearly 5,900 orders for Classes 6-8 trucks last month, its highest monthly total since December 2011.
“As far as regaining market share, we recognize that it’s still a top priority, but there is a positive trend,” she said.
