Credit ratings

The credit ratings of Daimler AG changed in 2019 with four of the agencies we have engaged to provide ratings. Moody’s and S&P downgraded their short-term and long-term ratings by one notch. Both agencies changed the outlook from “stable” to “negative.” DBRS also changed the trend on the long-term rating from “stable” to “negative.” With Fitch, our short-term rating was upgraded by one notch to F1. (See table B.34)

B.34 Credit ratings

  End of 2019 End of 2018
     
Long-term credit rating    
S&P A– A
Moody's A3 A2
Fitch A– A–
Scope A A
DBRS A A
     
Short-term credit rating    
S&P A-2 A-1
Moody's P-2 P-1
Fitch F1 F2
Scope S-1 S-1
DBRS R-1 (low) R-1 (low)

On May 21, 2019, Fitch Ratings (Fitch) affirmed its long-term issuer default rating for Daimler AG of A- with a stable outlook. Fitch emphasized Daimler’s strong business profile and the leading positions of its automotive divisions. At the same time, Fitch upgraded its short-term rating from F2 to F1. This step was taken with reference to the Group’s good financial situation and financial flexibility.

The European rating agency Scope Ratings (Scope) confirmed its issuer rating of A for Daimler AG and its financing companies on December 17, 2019. Scope assumes that Daimler will continue to maintain its leading market position with Mercedes-Benz Cars and Daimler Trucks. The Group’s diversified global presence also supports the rating. Daimler’s financial risk profile in view of the significant surplus liquidity continues to be a key factor for the rating.

On December 12, 2019, S&P Global Ratings (S&P) lowered its long-term issuer rating for Daimler AG from A to A-. The outlook was assessed as “negative.” The short-term rating was altered from A-1 to A-2. S&P explained this action primarily with Daimler’s significantly reduced earnings guidance. In addition, S&P believes Daimler remains exposed to multiple headwinds. They include the transition of its product portfolio to electric vehicles, the challenge of complying with stricter European CO2 targets, geopolitical risks for world trade, intensifying competition and the execution of Daimler’s planned restructuring program.

Moody’s Investors Service (Moody’s) downgraded its long-term credit rating for Daimler AG and its subsidiaries included in the rating from A2 to A3 on December 13, 2019. The outlook was changed to “negative.” The short-term rating was down-graded to P-2. Moody’s explained this step with Daimler’s reduced earnings guidance for the coming years and the additionally anticipated restructuring costs from the announced efficiency program. Moody’s also sees challenges in the changeover of the product portfolio to battery-electric vehicles, as well as from a potential general decline in demand for light vehicles.

The Canadian agency DBRS confirmed its long-term rating for Daimler AG at A in a press release on November 28, 2019. However, the trend was changed from “stable” to “negative.” DBRS stated that this change reflects Daimler’s recently weaker earnings and the structural headwinds in our core automotive business. The trend on the short-term rating of R-1 (low) was maintained at “stable.”

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