Stellantis: S&P downgrades long-term credit rating

(CercleFinance.com) - S&P Global Ratings announced on Thursday that it had downgraded its long-term credit rating on Stellantis to 'BBB' from the previous 'BBB+', notably citing concerns about the evolution of the group's margins.


The rating agency points out that the automaker's profit margins came in below its expectations when it published its 2024 annual results on 26 February.

Regarding FY 2025, S&P points out that Stellantis has issued forecasts pointing to a "limited" improvement in profitability, with margins again expected to miss its estimates.

The agency notes that the introduction of additional customs duties in the United States is also likely to penalize the group, which imports 400,000 vehicles from Mexico and 140,000 from Canada every year.

The outlook associated with its credit rating remains 'stable', however, with S&P believing that Stellantis is in a position to stabilize its market shares in North America and Europe and generate an adjusted operating margin well above 8% by 2026, compared with 6% in 2024.

Although downgraded credit ratings generally imply higher borrowing costs for issuers, Stellantis shares were up 1.2% on Thursday on the Paris Bourse.


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