Fitch Ratings cut General Motors Corp. debt farther into junk status on Monday, citing the lack of progress in reducing costs, The Associated Press (AP) reported.

The rating agency reportedly lowered the ratings for GM and finance arm General Motors Acceptance Corp. to a double-B from a double-B plus. The troubled automaker’s consolidated debt stands at about $292 billion.

According to AP, Fitch analyst Mark Oline pointed out the company has not made any “tangible progress” in reducing its fixed cost structure, including escalating health care costs and other liabilities. In addition, he said higher fuel prices and recent sales incentives have also taken a toll on the company.

“Recent incentive programmes have established lower market pricing that makes GM increasingly vulnerable to volume declines which could occur as a result of a decline in economic conditions or simply a sustained falloff following recent industry sales spikes,” Oline said, according to the report.

He reportedly added GM faces a number of impediments to reducing costs, and opportunities to do so “have continued to narrow.” Fitch kept GM and GMAC‘s debt at a negative outlook, meaning further downgrades are possible.

Regarding GM’s negotiations with the United Auto Workers regarding health care, Fitch “believes there may be progress in working toward a negotiated solution.” However, the rating agency expects modest progress will be made in the short term, but the risk could become more significant once both sides begin to hammer out a 2007 contract, the Associated Press said.