[
THE INVESTOR] Korea's local credit appraiser
NICE Investors Service considers cutting credit ratings of Volkswagen Financial Services Korea, a unit of the troubled German carmaker caught in a recent emissions-rigging scandal.
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A Volkswagen store in Bangbae-dong, southern Seoul |
The rating firm said on July 26 the company was included in its latest monitoring list for a possible credit downgrade, maintaining the current credit rating at “A+” for now.
“Volkswagen Korea is likely to struggle with its finances following its voluntary recall of the affected vehicles that started on July 25,” the firm said in its recent report.
“The sales suspension could lead to sluggish car sales, reduced dealership network and downgraded brand awareness,” it said, adding that diverse factors will be considered before deciding the final rating.
The Environment Ministry has started canceling registrations of 79 models of 34 Volkswagen, Audi and Bentley vehicles sold in Korea for manipulating documents to cheat the government’s emissions tests.
By Lee Ji-yoon (
jylee@heraldcorp.com)
