Company Taking Necessary Actions to Offset Surging Steel and Energy Prices
TROY, Mich., May 13 /PRNewswire-FirstCall/ -- ArvinMeritor, Inc. (NYSE:
ARM) today reported that it plans to initiate a new commodity surcharge
starting June 1, 2008.
"As a result of the sudden and extraordinary surges in the price of
steel, energy and other commodities, we are implementing a monthly review
and adjustment process on all products," said Chip McClure, chairman, CEO
and president of ArvinMeritor. "We have a portfolio of complex products
that require varying levels of commodities. We plan to adjust the surcharge
as appropriate for each product line."
In ArvinMeritor's second-quarter earnings report issued on April 29,
2008, the company stated that the unprecedented volatility in the commodity
markets -- including a global shortage of scrap steel, a rapid escalation
in the price of critical raw materials such as iron ore, coking coal and
metal alloys, and higher fuel and energy costs, would require it to take
recovery actions to mitigate a significant impact to the company's
financial results.
McClure continued, "We remain diligent in the performance improvement
actions and cost reduction initiatives we are driving throughout our
worldwide operations, however, these will not be enough to offset the level
of cost increases we are experiencing. Our global team has worked hard to
improve the company's financial results, and we have the responsibility to
take the necessary actions to protect our bottom line.
The Commercial Vehicle Systems and Light Vehicle Systems business
groups have conducted an extensive analysis to determine the magnitude of
this situation and its potential effect on the business," said McClure.
"Results of that analysis clearly indicate that immediate actions are
necessary."
The company has begun discussions with its customers prior to
implementing the surcharge.
About ArvinMeritor
ArvinMeritor, Inc. is a premier global supplier of a broad range of
integrated systems, modules and components to the motor vehicle industry.
The company serves commercial truck, trailer and specialty original
equipment manufacturers and certain aftermarkets, and light vehicle
manufacturers. Headquartered in Troy, Mich., ArvinMeritor employs
approximately 19,000 people in 24 countries. ArvinMeritor common stock is
traded on the New York Stock Exchange under the ticker symbol ARM. For more
information, visit the company's Web site at: http://www.arvinmeritor.com/.
Forward-Looking Statements
This press release contains statements relating to future results of
the company (including certain projections and business trends) that are
"forward-looking statements" as defined in the Private Securities
Litigation Reform Act of 1995. Forward-looking statements are typically
identified by words or phrases such as "believe," "expect," "anticipate,"
"estimate," "should," "are likely to be," "will" and similar expressions.
Actual results may differ materially from those projected as a result of
certain risks and uncertainties, including but not limited to global
economic and market cycles and conditions; the demand for commercial,
specialty and light vehicles for which the company supplies products;
availability and sharply rising cost of raw materials, including steel and
oil; risks inherent in operating abroad (including foreign currency
exchange rates and potential disruption of production and supply due to
terrorist attacks or acts of aggression); OEM program delays; demand for
and market acceptance of new and existing products; successful development
of new products; reliance on major OEM customers; labor relations of the
company, its suppliers and customers, including potential disruptions in
supply of parts to our facilities or demand for our products due to work
stoppages; the financial condition of the company's suppliers and
customers, including potential bankruptcies; possible adverse effects of
any future suspension of normal trade credit terms by our suppliers;
potential difficulties competing with companies that have avoided their
existing contracts in bankruptcy and reorganization proceedings; successful
integration of acquired or merged businesses; the ability to achieve the
expected annual savings and synergies from past and future business
combinations and the ability to achieve the expected benefits of
restructuring actions; success and timing of potential divestitures;
potential impairment of long-lived assets, including goodwill; potential
adjustment of the value of deferred tax assets; competitive product and
pricing pressures; the amount of the company's debt; the ability of the
company to continue to comply with covenants in its financing agreements;
the ability of the company to access capital markets; credit ratings of the
company's debt; the outcome of existing and any future legal proceedings,
including any litigation with respect to environmental or asbestos-related
matters; the outcome of actual and potential product liability and warranty
and recall claims; rising costs of pension and other post-retirement
benefits and possible changes in pension and other accounting rules; as
well as other risks and uncertainties, including but not limited to those
detailed herein and from time to time in other filings of the company with
the SEC. These forward-looking statements are made only as of the date
hereof, and the company undertakes no obligation to update or revise the
forward-looking statements, whether as a result of new information, future
events or otherwise, except as otherwise required by law.
(Logo: http://www.newscom.com/cgi-bin/prnh/20010524/ARVINLOGO )
SOURCE ArvinMeritor, Inc.
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Related links:
http://www.arvinmeritor.com
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CONTACT:
Media, Krista McClure, +1-248-435-7115,
krista.mcclure@arvinmeritor.com, or Investors, Terry Huch,
+1-248-435-9426, terry.huch@arvinmeritor.com, both of
ArvinMeritor, Inc.
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