กรุงเทพฯ--3 มิ.ย.--Moody's Investors Service
Moody's Investors Service has a negative rating outlook for Asia Pacific's auto-parts sector over the next 12-18 months, but maintains a stable rating on its three rated issuers in the region.
The outlook is consistent with the rating agency's negative, medium-term forecasts for the auto-parts sectors in the U.S. and Europe.
In a new report, Moody's says that the rated Asian auto-parts manufacturers face significant challenges from compressed margins and slowing markets abroad, but have unique characteristics in their home markets, sales channels, and cost structures that enable them to expect continued financial stability going forward.
One of the report's authors, Chris Park, a Moody's vice president and senior analyst, says, "The rated South Korean parts producer, Hyundai Mobis, and the two rated tire companies, Indonesia's Gajah Tungal and China's GITI Tire, have been able to pass on surging input prices for rubber, oil, and steel to their customers."
He explained that Hyundai Mobis has a captive market as most of its sales go to the affiliated Hyundai and Kia Motors Group while the other two issuers have raised prices with a 3-6 month lag in the aftermarket for replacement tires.
The report's second author, Wonnie Chu, a Moody's analyst, says, "Car sellers are starting to experience a drop in sales to the U.S. and Europe. However, continued strong growth and high demand in China, in other developing countries, and in the Middle East should partially compensate for a slowing in developed markets."
Chu adds, "Although the three issuers' liquidity is expected to weaken as a result of ongoing growth in capacity, none of them face imminent refinancing risks." She notes that covenants on debt incurrence for the two rated tire makers are tight, but she says, "Moody's draws comfort that working-capital financing is carved out and both tire makers have no major funding requirement in the near term."
The report, entitled "Industry Outlook - Snapshot: Asia-Pacific Auto-Parts Manufacturers", can be found at www.moodys.com.
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