Global auto component supplier International Automotive Components Group S.A.'s free operating cash flow use in 2012 was higher than we anticipated because of high launch costs to support new programs, ongoing pricing pressure from customers, and an unfavorable product mix. We now believe that some of these risks could persist in 2013 and result in weaker-than-expected free operating cash flow given working capital requirements (to keep pace with modest expansion), potential increases in commodity costs, and ongoing capital expenditure needs. We are affirming our 'B+' corporate credit rating on the company and revising the outlook to negative from stable. The negative outlook reflects our view of at least a one-in-three likelihood of a downgrade over the next 12 months. NEW
