Despite the recall of more nearly 30 million vehicles in the U.S. this year, concerns about subprime lending and a lackluster showing in the stock market, Standard & Poors has given GM a much-needed endorsement, raising the company’s credit rating to investment grade.
The announcement comes at a welcome moment for GM, which has watched its share price slide 20% since the beginning of the year, even while the S&P 500 has gained 20%. It also coincides with a generally positive cover story in Time magazine featuring CEO Mary Barra.
Despite taking some serious hits in recent months, the ratings agency focused on the positive side, among other things, citing the progress of GM’s European turnaround plan, which could put the company back on a breakeven level after losing money for the past 15 years. S&P also noted the automaker’s healthy cash flow and the limited reputational and market share damage from what has become a record number of recalls.