VW’s Credit Rating Reduced by Standard & Poor’s

Volkswagen AG's credit rating on long-term debt has been lowered one notch from A to A- by Standard & Poor's Ratings Services as a result of the company's global diesel emission cheating scandal, Bloomberg News reports.

S&P, which warns it could lower the company's rating by another one or two more steps, says VW "demonstrated material deficiencies in its management and governance and general risk-management framework." The service adds that VW's internal controls have been shown "inadequate in preventing or identifying alleged illegal behavior."

S&P raised the VW's debt rating to A, its third-best rating, a year ago. It put the company on its watch list for possible downgrade on Sept. 22 after the company admitted rigging 11 million diesel engines to cheat government emission tests. Since then the scope of the scandal has continued to expand.

VW currently is the subject of new government probes in China, Europe and Japan. In U.S., where the cheating was revealed, the company already faces more than 250 lawsuits, a year of costly recalls and federal fines that could reach €6 billion.