Moody's Investors Service has warned it may downgrade General Motors after the US car maker delayed filing its annual report. The agency said the delay puts GM at risk of defaulting on its bonds and threatens the sale of General Motors Acceptance Corporation, its finance arm.

General Motors, whose finance arm has attracted takeover interest from hedge fund Cerberus Capital Management and private equity firm Kohlberg Kravis Roberts, yesterday raised its 2005 losses by $2bn (€1.6bn) and announced a delay in filing its annual report because of an accounting issue at ResCap, the residential mortgage arm of GMAC.