GM Strike Seen Forcing Credit Firms to Mull Negative Action

The United Auto Workers union’s strike against General Motors Co. may force credit raters to take action and move the company closer to junk status, according to Bloomberg Intelligence.

Now in its fourth week, the strike has gone beyond the two-week threshold that raters including Moody’s Investors Service and S&P Global Ratings had said posed downside risk, Bloomberg Intelligence analyst Joel Levington wrote in a report Wednesday. The “fuse is burning” for ratings that, in Moody’s case, is just one notch above junk, Levington said.