Rating agency Standard & Poor's on Tuesday raised the outlook on Toyota Motor Corporation's 'AAA' long-term debt rating to stable from negative, citing its strong performance despite a harsh business environment, Reuters reported.

The news agency noted that Japan's biggest carmaker boosted sales in every major market last year thanks to a steady launch of popular, new models.

"Backed by its strong product competitiveness and the geographic diversity of its operations, Toyota is expected to preserve its excellent market position and solid financial performance," S&P's credit analyst Chizuko Satsukawa reportedly said in a report that affirmed the agency's top 'AAA' rating on Toyota.

According to Reuters, S&P said it expected Toyota's operating and financial performance to keep improving as it continues to cut costs and strengthen its sales channels.

Toyota's leadership in the development of cleaner, next-generation cars will also help it maintain solid profitability despite intense global competition and the recent unfavourable rise in the yen against the dollar, the report added, according to Reuters.

The news agency noted that Toyota, which probably overtook Ford as the world's second-biggest car maker in 2003, also has a top-notch Aaa long-term credit rating from Moody's Investors Service.

S&P has a long-term debt rating of BBB- on Ford and BBB on General Motors, Reuters added.