Moody's Investor Services lowered the credit ratings of General Motors Corp. and Ford Motor Co. to "junk" status yesterday, deepening the financial pressure on the world's two largest automakers.

Moody's was the last of the three major credit-rating agencies to assign junk-level ratings to $170 billion of GM's debt. Two of three have rated Ford's roughly $160 billion in bonds as junk.

Burnham Securities analyst David Healy doubts the lower ratings, which increase a company's borrowing costs, will immediately affect the finances at the two largest automakers. But, he said, GM has the tougher task.

"Moody's requires some optimistic developments to take place in 2006 for GM's ratings to change — positive cash flow and success of its new full-size SUVs and pickup trucks. And I'm not sure that will happen," Healy said. "They're suffering from too high legacy costs and too many people in too many plants."

GM, which lost $2.5 billion in the first half of 2005, expressed disappointment with the downgrade.

After Ford's North American auto unit posted a $907 million second-quarter loss, the company said it would cut more jobs and announce plant closings later this year, on top of a plan to trim 2,700 of its 35,000 white-collar jobs in North America this year.

Ford has 19 assembly plants in North America; GM has 54 assembly and parts plants in the United States.