S&P rates Beijing Automotive notes A-

Standard & Poor’s said it assigned an A- long-term issue rating and cnAA long-term Greater China regional scale rating to the proposed issues of euro-denominated fixed-rate notes that Beijing Automotive Group Co. Ltd. will unconditionally and irrevocably guarantee.

BAIC Inalfa HK Investment Co. Ltd., an offshore subsidiary of Beijing Automotive, will issue the notes, S&P said.

The proceeds will be used for refinancing and general corporate purposes, the agency said.

The ratings reflect the company’s BB+ stand-alone credit profile and an opinion that there is a very high likelihood that the municipal government of Beijing will provide sufficient and timely extraordinary support to the company in the event of financial distress, the agency said.

The company is expected to maintain its position as a major automaker in the China market, S&P said.

But, the agency said it believes the competitive landscape of the Chinese automotive industry will continue to limit the company’s profitability.

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