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Moody's Lowers Credit Outlook on Yamaha Motor

July 4, 2012
Ratings agency says new regulations in key Indonesian market likely to dampen motorcycle manufacturer's sales.

Moody's said Wednesday it lowered its credit outlook on Yamaha Motor (IW 1000/249) to negative from stable, and warned of a possible ratings downgrade, over the motorcycle maker's key Indonesian market.

Jakarta has issued new regulations requiring a minimum down payment for motorcycle purchases, which may result in lower sales and put pressure on Yamaha's balance sheet, the global ratings agency said.

"Moody's expects Indonesian motorcycle sales to decline substantially as a result of new regulations implemented by Indonesia's central bank and ministry of finance," it said, adding "a [ratings] downgrade is also possible."

The Indonesian motorcycle market accounts for about 45% of Yamaha Motor's global sales, it said, adding the country's two-wheeler sales were forecast to drop 19% in 2012 from the 8 million units sold in 2011.

"Overall, Moody's does not expect earnings from other regions and business segments to fully offset the decline in Indonesian motorcycles."

However the agency also said Yamaha's global market position remains strong, supporting its decision to keep the firm's A3 credit rating unchanged.

Copyright Agence France-Presse, 2012

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