Volkswagen ratings cut by S&P may be just first blow

Volkswagen’s credit rating was cut one level yesterday by Standard & Poor’s, which said the German car maker’s cheating on diesel-emissions tests indicates management weaknesses that may lead to a further debt downgrade.

S&P lowered Wolfsburg-based Volkswagen’s rating on long-term debt to A-, the fourth-lowest investment grade, from A, and said that another cut of as much as two notches is possible.

“VW has demonstrated material deficiencies in its management and governance and general risk-management framework,” Alex Herbert, a London-based analyst at S&P, said.