NEW YORK -- Standard & Poor's on Thursday cut its debt rating on Delphi Corp. deeper into junk status, citing concerns the auto parts supplier may file for bankruptcy within days if it is unable to negotiate a bailout.
Delphi has been negotiating with its former parent General Motors and the United Auto Workers on an agreement to help it trim costs. The parts supplier has said that without a deal, it may file for bankruptcy by Oct. 17, when a less favorable bankruptcy law takes effect.
"Although a potential deal is still possible, it now appears less likely because of the complexity of the issues involved and the very limited time frame remaining to reach an agreement," S&P said in a statement.
Delphi has total debt of about $6 billion and unfunded pension and retiree benefit liabilities of about $14.5 billion, S&P said.
S&P cut Delphi's corporate credit rating by two notches to "CCC-minus," a deeply speculative rating signaling substantial default risk, from "CCC-plus."