ArvinMeritor has defined six key priorities for 2010. The company believes it is imperative to execute well in each of these areas and has developed specific action plans to achieve strong growth. It will remain focused on rigorous cost management to realize improved operating leverage; continue to focusing on global commercial vehicle and industrial markets; successfully execute as global markets recover, drive innovation, accelerating new products and advanced fuel-efficient technologies; and maintain focus on sustainable profitable growth.
Mr. Chip McClure, Chairman & CEO of ArvinMeritor, said: “2009 was a tough year for the Global economy. Although we saw our markets around the world dramatically drop off last year, as much as 60 to 75 per cent, we never stopped investing in our future. With the steps we have taken to manage costs – in addition to our efforts to secure new multi-year contracts, develop advanced solutions for our customers, and focus talent and resources on strategic segments of our business – we believe we are on track to benefit from future recoveries in the global markets.”
Mr. Carsten J. Reinhardt, Senior Vice President and Chief Operating Officer, ArvinMeritor, said: “We have come out of the recession much stronger than what we had been. We have not just survived the recession but turned ArvinMeritor into a company that is focussed on a very clear market segment, which is commercial vehicles and industrial. We have segmented our company into 3 major segments – Commercial Truck, Trailer and Aftermarket, Industrial”.
On the recovery in global markets, Mr. Carsten said: The North American truck market is recovering fast and although not at record levels but certainly at increased levels from past year and we see that continuing into the next quarter as well. We are very bullish in the longterm and confident that the North American market is going to come back stronger. 2011 we believe will be a strong year and will continue for many years and we at ArvinMeritor are prepared to be a part of that”.
He said: “In Europe there was a deep drop in the commercial vehicle segment and the market went down by almost 70% when the crisis started. The good news is we see Europe coming back. Our factories in Europe have started to ship a good number of our products and we are starting to see a level of bullishness and very encouraged by the signs. It is going to be a gradual comeback unlike in the US, which recovered due to the emission change. It is very difficult to predict as to when we would get back to 2008 levels but we will certainly grow well”.
“In South America, ArvinMeritor is producing at all time record levels. We have never made as many axles as we have made in the month of March 2010. The industry is expected to surpass the record levels of 2008. For ArvinMeritor it is a very important market for brakes, axles, suspensions. We are the market leader in South America and our facility is running in full throttle – 7 days a week, 3 shifts. We are bullish about the growth prospects in this market”, Mr. Carsten added.
Talking about Asia, Mr. Carsteen observed: “India and China are significant markets for ArvinMeritor. Both markets are back to pre-crisis levels. It is very encouraging as it didn’t really take long for both markets to comeback. The plant in China is running 7 days week and important part of the business in China is in the off-highway and construction equipment segment. Overall the global market is doing well so does ArvinMeritor”.
Referring about investments, Mr. Carsten said: “Despite the downturn, we have continued to invest. We have increased our engineering spend by 30%, which is a significant number and a sign that Meritor is back as an innovation leader. We are investing in all parts of the world in brakes, axles, suspensions. We are planning a major launch of innovation of our 17X product line in Hannover in Sept. The new technology will take high efficiency axles to ultra-high efficiency levels. A lot of engineering work is coming out of Europe as the fuel cost is twice as much in the US. There is more drive for efficiency and it an asset for us to be in Europe where the customers are pushing us to improve our technologies. We have announced significant investments in our brake business both in Europe and North America. We are spending over $ 60 million in this business to bring the next generation of brake products both in drum and disc brakes to the global market place”.
New axle launches
ArvinMeritor has announced plans to expand its off-highway business in a big way. The company recently launched two new axles for terminal tractor and all-terrain crane applications.
Fuelling the expansion is a customer-focused strategy that provides unmatched speed-to-market, unique customization capabilities and superior quality and durability – supported by global engineering and manufacturing resources, in addition to a well-known and trusted aftermarket parts and service network.
“We have a well-defined strategy to grow our off-highway business to meet the forecasted demand in the coming years,” said Mr. Tim Bowes, President of Industrial and Asia Pacific for ArvinMeritor. “We are investing in product design and development, as well as manufacturing capacity, while simultaneously executing successful production launches for our growing customer base.”
Using a modular design approach for carriers, wheel-ends and braking systems, the company is engineering products that offer its customers’ customized solutions – and doing so with lead times the company believes to be approximately 50 per cent less than its competitors.
“With our long history of expertise in designing and manufacturing heavy-duty axles for commercial vehicle customers, and the strong off-highway capabilities we have developed in China, we are prepared to grow this business and seize global market opportunities,” added Mr. Bowes.
The company manufactures its off-highway drivetrain components in Xuzhou, China, a joint venture with its long-term partner, Xuzhou Construction Machinery Group (XCMG), and at its manufacturing facility in Newark, Ohio. ArvinMeritor is the leading producer of off-highway axles in China with a strategic priority to expand in all major regions of the world.
