Junk bond ratings on troubled LAX people mover drop again as key deadline nears

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Set us as preferred Credit agency Fitch Ratings has dealt another blow to the troubled Skylink people mover train at Los Angeles International Airport, downgrading the project’s debt deeper into junk bond territory over the continued inability of the contractor and city’s airport department to complete the project.The downgrade — to B-, from BB four months ago — “reflects the near certainty” that contractor LINXS won’t have the 2.25-mile train running by Dec.8, leading to a “technical event of default and could give rights to either LINXS or Los Angeles World Airports ...

to issue project termination notices,” Fitch said in a report this week.“It’s an uncommon action of severity,” Fitch analyst Seth Lehman told The Times.

“We were under the view that there was a fair amount of cushion for LAWA and LINXS to settle on disputes, or for LINXS to show that they can have the trains run safely per this reliability test.”The contractor has already said the train won’t be ready until February 2027 — or even later.In a statement to The Times Thursday, a spokesperson said that “LINXS remains committed to working with LAWA to successfully deliver the Automated People Mover and provide a world-class transportation system for the Los Angeles region.”LINXS, an acronym for LAX Integrated Express Solutions, is a consortium that includes Fluor, Balfour Beatty, Alstom Transport USA, ACS Infrastructure Development, HNTB, Dragaos USA.

LINXS declined comment beyond the statement.LAWA officials had no immediate comment on the latest bond downgrade.The deadline for the train’s completion is Dec.

8.While the airport or the contractor could technically terminate the contract at that time, Lehman noted that there’s a 120-day buffering period to allow for additional time to settle issues.“After you get past that date, then the question becomes: Will both sides still want to work with each other...