TEXT-Fitch cuts 'Big Three' dealer floorplan ABS

(The following statement was released by the rating agency)

April 14 - Fitch Ratings has downgraded certain classes of notes from each
of Chrysler Financial LLC (CF), GMAC LLC (GMAC) and Ford Motor Credit Company
(FMCC) related dealer floorplan asset-backed securities (DFP ABS). Each class
of notes remains on Rating Watch Negative. (A full list of rating actions
follows at the end of this release.)
Additionally, given the depth and breadth of challenges faced by domestic auto
manufacturers and their dealer networks by extension, Fitch will not consider
rating new transactions until it can provide more definitive guidance on how
corporate risk and the impact of system wide deterioration are fully
incorporated into its rating methodology and process for these related
transactions.
The rating actions reflect the significant financial challenges impacting
Chrysler LLC (Fitch Issuer Default Rating [IDR] of 'C'), General Motors Corp.
GM.N ('C' IDR) and Ford Motor Company (F.N) ('CCC' IDR), their related
finance companies and respective franchised dealer networks. Severely depressed
March new vehicle sales levels along with recent U.S. government announcements,
including the rejection of General Motor's and Chrysler's submitted viability
plans and increased potential for one or more of the domestic auto
manufacturers to file for bankruptcy, with or without additional government
funding, continues to create a great deal of uncertainty regarding the
near-term prospects for each of the companies.
As stated in Fitch's Feb. 6, 2009 press release, this unprecedented set of
events affecting the domestic auto industry creates a risk profile that is
outside that currently contemplated in Fitch's existing criteria for rating DFP
ABS. Specifically, the existing criteria and stress case scenarios are limited
to the assumption that an individual auto manufacturer files for an orderly
Chapter 11 bankruptcy, the result of which is a reorganization of the company
and continued operations, and attempts to model the impact to that issuer's
outstanding transactions. Currently, given the overall economic climate,
ongoing disruptions in the credit and capital markets and all three domestic
auto manufacturers facing financial difficulties simultaneously, the potential
for a large number of franchised dealers to experience financial difficulty or
bankruptcy over a short time frame, necessitating the liquidation of a large
number of vehicles in an already depressed consumer demand environment, could
impact key performance variables including monthly payment rates (MPR), dealer
defaults and loss severity beyond those utilized in assigning the original
ratings.
The revised ratings of FMCC and GMAC issued DFP ABS also reflect Fitch's
opinion that with Ford Motor Company's and General Motors Corp.'s greater scale
and relevance to U.S. manufacturing capabilities, there is a higher likelihood
of some base level of government support which would allow for continued
operation of the manufacturers. If this is the scenario that unfolds, current
enhancement levels in each of their related DFP ABS provide a strong degree of
protection for their respective DFP ABS issuances. Additionally, the
affirmation of FCFMOT series 2006-3 class A notes and class B notes at 'AAA' on
Rating Watch Negative and 'A' on Rating Watch Negative, respectively, reflect
their upcoming June 2009 expected final payment date and Fitch's opinion that
Ford's financial condition and the transactions performance metrics will remain
within expectations during the next two months. Fitch has distinguished CF's
DFP ABS ratings to recognize the view of heightened risk of a Chrysler LLC
bankruptcy and liquidation scenario and the pressure that would create on the
dealer network and vehicle values.
Fitch has decided to refrain from rating new DFP ABS transactions from any of
the three domestic issuers until it has better addressed the high level of
variance and uncertainty in determining stress case assumptions for key
performance variables for these issuers, particularly at the 'AAA' level.
Key to determining the basis for updated thresholds to address the multitude of
risks that have developed will be clarity in outcomes for government aid and
potential financial and operating restructurings for Chrysler, GM and Ford. In
addition, it will be important to assess the near-term outlook for the domestic
auto industry as a whole as well as the financial and operating prospects for
each of the individual auto manufacturers. Without a clear assessment of the
near-term outlook, there exists a great deal of potential variance to cashflows
and default and severity assumptions for dealer floorplan loans supporting each
of these DFP ABS.
Fitch envisions future Fitch rated new DFP ABS issuances from captive finance
companies, whether auto related or not, where significant manufacturer
concentrations are present, will likely be limited to manufacturers who
maintain at minimum a 'B' IDR rating level. In addition, Fitch will attempt to
establish stress case scenarios that address corporate risk and the system wide
deterioration currently impacting the domestic auto industry to ensure any
future 'AAA' ratings have addressed these risks sufficiently.
The classes listed below are fixed and floating rate notes issued by CF
(MCFOT), FMCC (FCFMOT) and GMAC (SWIFT and SMART) secured by loans made by each
company to franchised vehicle dealerships to support their purchase and
flooring of vehicles manufactured by the related manufacturer. The rating
actions affect approximately $11.3 billion in outstanding DF ABS rated by
Fitch.
Master Chrysler Financial Owner Trust (MCFOT) (f.k.a DaimlerChrysler Master
Owner Trust)
--Series 2006-A term notes downgraded to 'A' from 'AAA'.
Ford Credit Floorplan Master Owner Trust A (FCFMOT)
--Series 2006-3 class A notes remain at 'AAA';
--Series 2006-3 class B notes remain at 'A';
--Series 2006-4 class A notes downgraded to 'AA' from 'AAA';
--Series 2006-4 class B notes downgraded to 'BBB' from 'A'.
Superior Wholesale Inventory Financing Trust (SWIFT X)
--Series 2004-A class A notes downgraded to 'AA' from 'AAA';
--Series 2004-A class B notes downgraded to 'BBB' from 'A';
--Series 2004-A class C notes downgraded to 'BB' from 'BBB';
Superior Wholesale Inventory Financing Trust (SWIFT XI)
--Series 2005-A class A notes downgraded to 'AA' from 'AAA';
--Series 2005-A class B notes downgraded to 'BBB' from 'A;
--Series 2005-A class C notes downgraded to 'BB' from 'BBB+';
--Series 2005-A class D notes downgraded to 'B' from 'BB+';
Superior Wholesale Inventory Financing Trust
(SWIFT 2007-AE-1)
--Class A notes downgraded to 'AA' from 'AAA';
--Class B notes downgraded to 'BBB' from 'A+';
--Class C notes downgraded to 'BB' from 'BBB+';
--Class D notes downgraded to 'B' from 'BB+'.
SWIFT Master Auto Receivables Trust (SMART)
--Series 2007-2 class A notes downgraded to 'AA' from 'AAA';
--Series 2007-2 class B notes downgraded to 'BBB' from 'A+';
--Series 2007-2 class C notes downgraded to 'BB' from 'BBB+';
--Series 2007-2 class D notes downgraded to 'B' from 'BB+';
All transactions remain on Rating Watch Negative.
Contact: Ravi R. Gupta +1-312-368-2058 Chicago; Hylton Heard +1-212-908-1214,
John Bella +1-212-908-0243 New York.
(New York Ratings Team)