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Standard & Poor’s Ratings Services on Thursday cut its ratings for all three of the U.S.-based automakers further into junk status, citing worries about their mounting cash losses and the continued deterioration of the U.S. auto market.

S&P lowered its ratings for General Motors Corp. Ford Motor Co. and Chrysler LLC all to "B-" from "B." It also lowered its ratings on the trio’s respective financing arms - GMAC LLC, Ford Motor Credit Co. and DaimlerChrysler Financial Services Americas LLC - to "B-" from "B."

In addition, the ratings service cut its corporate credit rating on FCE Bank PLC, Ford Credit’s European bank, to "B" from "B+."

"We believe sharply lower U.S. light-vehicle demand and the recent dramatic shift in demand away from large pickup trucks and SUVs amid higher gas prices will complicate the turnaround efforts of all three automakers and reduce their currently adequate liquidity considerably over the next year and a half," S&P Credit Analyst Robert Schulz said in a statement.

"This will leave them more vulnerable to already adverse industry, economic, and credit market conditions."

S&P said it expects U.S payday loan. vehicle sales, especially those of trucks and SUVs, to continue to weaken and result in higher cash losses for all three automakers in the second half of 2008.

The outlooks on all the companies are negative.

S&P said it does not expect to change the outlooks or raise the ratings for any of the companies within the next year, in light of the current economic outlook, risks associated with their restructurings and potential pressure on their available cash.

In afternoon trading, GM (GM, Fortune 500) fell 15 cents to $11.25, while Ford (F, Fortune 500) rose 9 cents to $4.93. 

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