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Daimler Fitch Rating Update
Mercedes-Benz South Africa Limited (Incorporated in the Republic of South Africa) (Registration No.
1962/000271/06)
Bond Issuer code: MEC
(“Mercedes-Benz” or “the Issuer”)
Fitch Downgrades Daimler AG to 'BBB+'; Outlook Stable
Noteholders are advised that Fitch Ratings (“Fitch”) has downgraded Daimler AG's (“Daimler”) Long-
Term Issuer Default Rating (IDR) to 'BBB+' from 'A-' with a Stable Outlook.
The downgrade reflects the deterioration of Daimler's financial profile and Fitch's projections that a
recovery will be slow. Fitch expects a sustained weakened economic environment and its effect on
new car and heavy truck sales in the next one-to-two years to exacerbate the underlying
fundamental challenges facing the group. Fitch expects Daimler's free cash flow (FCF) to be
constrained by significant investments into sustainable and alternative mobility and potential
penalties related to the group's fuel emissions.
Fitch’s Stable Outlook reflects the headroom in the rating following the rating action. Fitch's base
case includes a major global economic downturn in 2020 that will significantly affect new vehicle
sales globally. Nonetheless, Fitch expects a rebound in sales in 2H20 and into 2021 albeit to a lower
level than previously assumed. Weaker-than-expected new vehicle sales and earnings in the
coming months could put renewed pressure on the ratings.
Detailed information in this regard may be viewed through the following link:
www.fitchratings.com
Centurion
15 April 2020
Debt Sponsor: The Standard Bank of South Africa Limited
debtsponsor@standardbank.co.za
Date: 15-04-2020 02:39:00
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