Qantas Airways Ltd. (QAN), the Australian carrier that yesterday struck a 10-year alliance with Emirates to turn around losses on international routes, had its credit rating cut to the lowest investment grade by Standard & Poor’s.
The airline’s debt grade was lowered by one level to BBB- with a stable outlook, according to an e-mailed statement from the ratings company.
“Qantas’s business risk profile has weakened because of the structural pressures affecting the airline’s international business,” Melbourne-based analyst May Zhong said in the S&P statement. “Persistent pressures have eroded Qantas’s market share and inflicted losses on the airline’s international operations in the past few years.”
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