Good profitability; Strong market shares; and Fair diversity among truck, bus, off-highway, and military markets. Highly leveraged balance sheet; Cyclical end markets; Growing but still limited geographic diversity; High fixed costs; and Exposure to volatile raw material costs. The ratings on Indianapolis-based Allison Transmission Inc. reflect the company's highly leveraged financial risk profile, which more than offsets the company's good profitability, strong market shares, and fair end-market diversity as a leading supplier of automatic transmissions for a variety of commercial vehicle, off-highway, and military applications. Standard & Poor's Ratings Services considers Allison's business risk profile to be weak, reflecting the cyclicality, high fixed costs, customer concentration, and raw-material price sensitivity of the commercial vehicle supplier business. As we had expected,...
Companies mentioned in this report are: Allison Transmission Inc.
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