Ratings agency Fitch Ratings has issued reports on US Airways Group Inc (NYSE: LCC) and UAL Corporation (Nasdaq: UAUA), the parent company of United Airlines.

Fitch has downgraded the debt ratings of US Airways Group. The Issuer Default Rating (IDR) is changed to 'CCC' from 'B-'; the secured term loan rating to 'B/RR1' from 'BB-/RR1'; and the senior unsecured rating to 'CC/RR6' from 'CCC/RR6'.

The company said its ratings apply to approximately USD1.7bn in outstanding debt. The Rating Outlook is Negative.

The downgrade for US Airways Group was attributed to the continued rise in fuel costs which is eroding margins and operating cash flow generation for the airline and also its US competitors.

For UAL Corp and United Airlines Inc, Fitch has revised the Rating Outlook to Negative from Stable. The debt ratings have been affirmed, with the UAL & United Issuer Default Ratings (IDR) at 'B-'; United's secured bank credit facility (Term Loan and Revolving Credit Facility) at 'BB-/RR1'; and the senior unsecured rating for United at 'CCC/RR6'.

The bank facility rating applies to approximately USD1.3bn of funded term loan debt, and the unsecured rating applies to approximately USD1.4bn of outstanding notes, Fitch said.