Bangkok--7 Jul--Standard & Poor's
A multiyear recovery in auto demand is gradually gaining momentum, in Standard & Poor's Ratings Services' opinion, and that bodes well for global auto suppliers. In a report published today on RatingsDirect, titled, Auto-Related Suppliers Continue To Benefit As The Global Auto Industry Stabilizes, a continuing, albeit slow, recovery in auto sales, increased vehicle production, and the capital markets' improved appetite for auto and auto supplier risk support this view.
We believe the fair prospects for auto suppliers that we cited early this year will continue and may even be better than our early 2010 assumptions. But the delicate state of the economic recovery in many regions and the omnipresent key industry problems such as overcapacity will continue to loom as threats to credit quality, in our view.
We also rate several companies in auto-related businesses whose performance does not directly depend on automaker production: a used-vehicle auction company, auto aftermarket parts manufacturers, tire makers serving the replacement market, and auto retailers for whom the parts and service business is a critical source of profitability. For these companies, a broad economic recovery remains important for their future creditworthiness. Here, too, we have seen improvements since 2009, but we remain cautious about the strength of the recovery.
The report is available to RatingsDirect on the Global Credit Portal subscribers at www.globalcreditportal.com and RatingsDirect subscribers at www.ratingsdirect.com. If you are not a RatingsDirect subscriber, you may purchase a copy of the report by calling (1) 212-438-7280 or sending an e-mail to
[email protected]. Ratings information can also be found on Standard & Poor's public Web site by using the Ratings search box located in the left column at www.standardandpoors.com. Members of the media may request a copy of this report by contacting the media representative provided.
Media Contact:
Mimi Barker, New York (1) 212-438-5054,
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Analyst Contacts:
Robert Schulz, CFA, New York (1) 212-438-7808
Barbara Castellano, Milan (39) 02-72111-253
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