S&P: Cooper-Standard Automotive on watch

Standard & Poor's said it placed its B+ corporate credit rating on Cooper-Standard Automotive Inc. on CreditWatch with negative implications after Ford Motor Co.'s announcement that it will sharply reduce vehicle production in the second half of 2006 from previously expected levels, with the largest cuts coming in the fourth quarter.

The agency said that Ford's production of light trucks in the fourth quarter will be down 155,000 units, or 28%, versus fourth-quarter 2005 production.

Cooper-Standard generates about 35% of its total revenue from Ford platforms and sales of the Ford F-series truck are a significant contributor to Cooper-Standard's earnings, according to the agency.

S&P added that Cooper-Standard's financial profile is already weak because difficult industry conditions caused the company to underperform financial expectations last year and because the February acquisition of the fluid-handling systems business of ITT Industries Inc. left it very aggressively leveraged.

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