S&P affirmed, however, Michelin’s short-term rating at A-2.
“The CreditWatch listing reflects our heightened concerns about Michelin’s ability to adequately strengthen its profitability and cash generation in a timely manner, and to reduce its financial debt, in order to achieve a financial profile and debt protection measures required for the current long-term rating,” S&P credit analyst Barbara Castellano told AFX.
Michelin said it expects to meet its 2006 earning targets despite a “further massive increase” in raw material costs.