Fitch: American Axle outlook stable

Fitch Ratings said it affirmed American Axle & Manufacturing Holdings, Inc. at issuer default BB and American Axle & Manufacturing, Inc. at issuer default rating BB, senior unsecured revolving credit facility BB, senior unsecured term loan BB and senior unsecured notes BB.

The outlook was revised to stable from negative.

The outlook change reflects Fitch's expectation that production cadence should be more consistent going forward following the launch of the new GM truck products, the agency said. The outlook also reflects a greater potential for debt reduction from free cash generation and an adequate liquidity cushion in the event of production shutdown.

The ratings reflect the risks associated with the company's dependence on General Motors Corp., currently rated B with a Rating Watch negative, and in particular with its full- and mid-size truck segments.

Partially offsetting these risks, Fitch said, are the company's margin performance, liquidity and competitive position; the financial benefits of recent headcount reductions and an expected improvement in free cash flow in 2007.

For 2006 the company's total debt-to-operating EBITDA ratio was 2.6 times and its total adjusted debt-to-operating EBITDAR, adjusted for rent, was 2.9 times.

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