ArvinMeritor rides Class 8s into black

May 1, 2006
Bolstered by the robust commercial vehicle market, component supplier ArvinMeritor has swung from a loss posted in its 2005 fiscal second quarter to profitability

Bolstered by the robust commercial vehicle market, component supplier ArvinMeritor has swung from a loss posted in its 2005 fiscal second quarter to profitability.

Accordingly, ArvinMeritor has revised its forecast for North American Class 8 truck production to 340,000 for the fiscal year ending Sept. 30 2006—a 5% increase over its previous estimate of 325,000.

If the industry does indeed reach that manufacturing peak, it would be very good news for the company, which derived 47% of its sales and all of its operating profit ($62 million) from its commercial vehicle group.

“It’s certainly one of the highest [years] ever in North American truck production,” Mike Pennington, senior director of global marketing communications told FleetOwner. “It’s good news for the industry and trucking suppliers.”

The upward revision was driven by two factors, Pennington said, “One is certainly the element of [pre-buying trucks] ahead of ‘07 emission regulations, and [secondly] overall good business conditions [for carriers].”

Pennington declined to draw conclusions on how much of the 340,000 estimate is attributable to pre-buy, saying “it’s a considerable factor” and that many fleets still intend to purchase ’07 equipment.

The company reported a net income $45 million for the quarter-ended March 31 compared to a $33 million loss posted in the same quarter last year.

ArvinMeritor is preparing for a drop-off in fiscal year 2007 commercial vehicle sales of up to 30% compared to 2006.

“We are taking steps to minimize the effect…related to the anticipated decline in the 2007 North American heavy truck market,” stated Chip McClure, chairman, CEO & president. “We expect improved productivity in our trailer business, continued growth in the commercial aftermarket business and increased sales from our Commercial Vehicle Emissions group.”

About the Author

Terrence Nguyen

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