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S&P Puts Hyundai Motor on CreditWatch - Negative

21 November 1997

S&P Puts Hyundai Motor on CreditWatch - Negative

    TOKYO, Nov. 21 -- Standard & Poor's today placed its 'BBB+'
long-term credit rating on Hyundai Motor Co. on CreditWatch with negative
implications.  The CreditWatch placement reflects concerns about Hyundai
Motor's ability to maintain its earnings and financial profile amid increased
difficulty in the Korean economy and the domestic automobile industry.
    Hyundai Motor's sales in the Korean automobile market are slowing amid
weakening economic conditions.  At the same time, the market shares of Korean
automakers are shifting, with Daewoo Motor increasing its market penetration.
Kia Motors, meanwhile, has resorted to deep price discounting over the past
year to reduce inventory levels.  Other destabilizing factors for the
automobile industry include the recent problems of the Kia Group, as well as
the prospective startup of Samsung Motors.  Hyundai Motor also may assume part
of the Hyundai Group's proposed  $5.8 billion investment in the construction
of an integrated steel mill.
    Standard & Poor's will reassess the company's ability to maintain its
strong operating performance under the currently difficult conditions.  In
addition, Standard & Poor's will examine the impact of increasing financing
costs amid continued large capital spending needs and moderately high debt
levels. -- CreditWire

    RATINGS ON CREDITWATCH - NEGATIVE
                             TO                  FROM
    Hyundai Motor Co.
    Counterparty credit rtg  BBB+/Watch Neg/--   BBB+/Negative/--
    Sr unsecd debt           BBB+/Watch Neg      BBB+

SOURCE  Standard & Poor's CreditWire