S&P: GM outlook positive

Standard & Poor's said it revised the outlook on General Motors Co. to positive from stable and affirmed its BB- corporate credit rating.

"The outlook revision reflects GM's consistent operating performance in North America in 2010, which led us to revise our business risk assessment to fair from weak," S&P analyst Robert Schulz said in a statement.

S&P said it believes there is at least a one-in-three chance that we could raise the corporate credit rating on GM during the next 12 months.

The rating reflects expectation that GM can sustain its return to profitability in North America, that it will continue to generate positive free operating cash flow in its global automotive operations and that it will use some of its substantial cash balances to address its massive unfunded global pension liabilities, according to the agency.

The rating was not affected by the company's initial public stock offering in late 2010 as common stock proceeds went to existing shareholders, the agency noted.

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