In another sign that largest American automaker has come back from its 2009 bankruptcy, for the first time since 2005, a credit rating firm has judged General Motors’ corporate debt to be investment-grade. On Tuesday, Moody’s Investors Service raised GM’s rating to Baa3 from Ba1. Baa3 is Moody’s lowest rating that it considers worthy of investment.
Moody’s cited GM’s new product in the United States, its strength in China, and management’s commitment to keeping a strong balance sheet. ”We think that the disciplines the company has embraced, combined with the strength of its U.S. product portfolio and a healthy domestic market, will enable it to stay on that path,” Bruce Clark, a senior vice president at Moody’s, said in a statement cited by The Detroit Free Press and praised, GM’s “steadily improving operational and financial trajectory.” Aggressive pricing by Japanese automakers and losses in Europe were cited as possible risks
Standard & Poor’s and Fitch, the other major ratings agencies continue to rate GM’s debt as junk bonds, though both firms recently raised their projections for the automaker from stable to positive.