Standard & Poor’s Ratings Services raised its outlook for TRW Automotive Inc. to “Positive” from “Stable. The rating service is increasing the potential for an upgrade into investment grade in the coming year.

“We believe that TRW’s solid competitive position in the global auto market, profitability, continuing free cash generation from operations, modest leverage, and strong liquidity could support an upgrade to investment grade in the year ahead if the following uncertainties are resolved”, S&P said.

The ‘BB+’ rating on TRW reflects our assessment of the company’s financial risk as “intermediate” and its business risk profile as “fair.”

TRW, which makes safety-related products such as brakes and airbag controls, reported stronger earnings for most of the last year as demand in the U.S. automotive industry recovered and many auto makers increased production.

The announcement comes a month after Fitch Ratings has upgraded the issuer default ratings for TRW and its main subsidiary TRW Automotive Inc. (NYSE:TRW) from “BB+” to “BBB-“ based on the rebound of the company from the global economic recession in 2009.

TRW Automotive in February reported that fourth-quarter earnings doubled, partly on an acquisition gain, though the company reported weaker margins.

With 2011 sales of $16.2 billion, TRW Automotive ranks among the world’s leading automotive suppliers. Headquartered in Livonia, Michigan, USA, the Company, through its subsidiaries, operates in 26 countries and employs over 60,000 people worldwide.


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