The rating on TRW Automotive Inc. reflects Standard&Poor's Ratings Services' reassessment of TRW's financial risk profile as intermediate and its business risk profile as weak. The financial risk profile is intermediate because of the company's conservative financial policy, which has led to permanent debt reduction using discretionary cash flow, and high funds from operations (FFO) to total debt. TRW's profits and cash flow in 2010 benefited from the continuing recovery in global auto markets because the company significantly cut costs during the economic downturn that had reduced its breakeven level of sales in North America and Europe. The rating also reflects the company's attention to debt reduction, including the reduction of pension obligations, which we believe will better
