Autoliv's Credit Ratings Upgraded

STOCKHOLM, Sweden--Regulatory News:

The credit rating for Autoliv Inc. was yesterday upgraded to “BBB/A-2 with a stable outlook” from “BBB-/A-3 with a stable outlook” by Standard and Poor’s. At the same time Moody’s Investor Service revised their outlook for Autoliv to stable from negative while the credit rating remained P-2. This means that Moody’s rating and outlook are the same as before the crisis.

In its announcement Standard and Poor’s said that its upgrade “reflects our view that Autoliv’s financial position and cash generation have been more resilient than we had previously anticipated during the severe downturn 2009. …. The Company has rapidly implemented what we view as a credit-supportive financial policy by suspending dividend payments and share buybacks, issuing new equity and reducing investment”.

Moody’s explained that its “outlook change to stable reflects Autoliv’s improved operating performance …. and Moody’s increasing confidence in a material improvement in profitability and credit metrics over the course of 2010 supported by the realization of cost savings from restructuring initiatives”. Autoliv Inc. - the worldwide leader in automotive safety - responded quickly to the credit crisis and the sharp downturn in the automotive industry last year. This was possible due to the fact that the Company initiated an action plan already in July 2008 which was accelerated when the crisis definitely broke out in September.

Due to these and other aggressive actions, Autoliv limited the number of quarters with negative cash flow to only the first quarter 2009, when sales dropped by almost 50%. In addition, the negative cash flow was only $45 million before financing, which has been more than offset by positive cash flows of $96 million in the second quarter and of $105 million in the third quarter.

Autoliv remained “investment grade” throughout the financial and automotive industry crisis.

At the end of September, Autoliv’s net debt amounted to $878 million and remaining market debt maturities during 2009, 2010 and 2011 totalled $401 million, while cash and liquid assets amounted to $430 million.

About Autoliv

Autoliv Inc., the worldwide leader in automotive safety systems, develops and manufactures automotive safety systems for all major automotive manufacturers in the world. Together with its joint ventures, Autoliv has 80 facilities with approximately 36,000 employees in 28 vehicle-producing countries. In addition, the Company has technical centers in eleven countries around the world, with 21 test tracks, more than any other automotive safety supplier. Sales in 2008 amounted to US $6.5 billion. The Company's shares are listed on the New York Stock Exchange and its Swedish Depository Receipts on the OMX Nordic Exchange in Stockholm (ALIV sdb). For more information about Autoliv, please visit our company website at www.autoliv.com.