8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 3, 2005

ARVINMERITOR, INC.

(Exact name of registrant as specified in its charter)

Indiana	1-15983	38-3354643
(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File No.)	Identification No.)

2135 West Maple Road

Troy, Michigan

(Address of principal executive offices)

48084-7186

(Zip code)

Registrant’s telephone number, including area code: (248) 435-1000

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act

Item 2.02. Results of Operations and Financial Condition

On May 3, 2005, ArvinMeritor, Inc. (“ArvinMeritor” or the “company”) issued a press release reporting its financial results for the quarter ended March 31, 2005. The release is furnished as Exhibit 99a to this Form 8-K.

On May 3, 2005, ArvinMeritor held a web-cast conference call, available to the public, to discuss its financial results for the quarter ended March 31, 2005. The presentation made on the conference call is posted on the ArvinMeritor website (www.arvinmeritor.com) and is furnished as Exhibit 99b to this Form 8-K.

Item 2.05. Costs Associated with Exit or Disposal Activities

On January 31, 2005, ArvinMeritor announced that, as part of a strategy to rationalize and refocus the company, it would eliminate 400 to 500 salaried positions and implement a plan to consolidate and combine certain global facilities as well as close or sell certain plants (which would involve additional employee terminations). ArvinMeritor estimates that a total of approximately $135 million will be incurred in connection with these actions and approximately $110 million of the charge will result in cash expenditures. In the second quarter of fiscal year 2005, ArvinMeritor recorded $62 million related to these actions, including $39 million related to employee termination benefits and $23 million of asset impairment charges.

Item 9.01 Financial Statements and Exhibits

(c) Exhibits

99a – Press release of ArvinMeritor, Inc., dated May 3, 2005.

99b – Presentation made on earnings conference call, May 3, 2005

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

ARVINMERITOR, INC.

By: /s/ Vernon G. Baker, II

            Vernon G. Baker, II

            Senior Vice President and General Counsel

Date: May 4, 2005

EXHIBIT INDEX

Exhibit No.	Description
99a	Press release of ArvinMeritor, Inc., dated May 3, 2005.
99b	Presentation made on earnings conference call, May 3, 2005

EX-99.A

CONTACTS: Media Inquiries

Lin Cummins

(248) 435-7112

linda.cummins@arvinmeritor.com

Investor Inquiries

Alice McGuire

(248) 655-2159

alice.mcguire@arvinmeritor.com

ArvinMeritor Reports Fiscal Year 2005 Second-Quarter Results and Provides Update on New Restructuring Program

TROY, Mich. (May 3, 2005)— ArvinMeritor, Inc. (NYSE: ARM) today reported financial results for its second fiscal quarter ended March 31, 2005.

• Sales of $2.3 billion, up 14 percent from the same period last year.

• Record Commercial Vehicle Systems (CVS) sales of $1,032 million, up 34 percent from the same period last year.

• Net loss, including new restructuring and other special items, was $33 million, or $0.48 per diluted share, compared to net income of $41 million, or $0.59 per diluted share last year.

• Loss from continuing operations, including new restructuring and other special items, was $35 million, or $0.51 per diluted share, compared to income from continuing operations of $40 million, or $0.58 per diluted share last year.

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• Income from continuing operations before new restructuring and other special items was $21 million, or $0.30 per diluted share, compared to $31 million, or $0.45 per diluted share last year.

• New restructuring and other special items include $62 million, or $0.65 per diluted share, of new restructuring costs resulting from the actions announced in January — the total estimated cost of these new restructuring programs is approximately $135 million, of which approximately $110 million will be cash costs; a $9 million, or $0.10 per diluted share, charge resulting from the MG Rover Group bankruptcy in Europe; and $6 million, or $0.06 per diluted share, of environmental remediation charges associated with a former Rockwell facility.

Despite tough conditions and many challenging issues within the industry as a whole, we are making good progress in growing our sales and managing our costs,” said Chairman, CEO and President Charles G. “Chip” McClure. “ArvinMeritor has some unique strengths – among them, a balanced and diversified portfolio of core businesses across global markets – that continue to support our efforts to overcome many of the industry-wide challenges we face.”

For the second quarter of fiscal year 2005, the company posted sales of $2.3 billion, a 14-percent increase when compared to the same period last year. Factors that contributed to the increase in sales included strong CVS worldwide markets, which added approximately $150 million in sales. Currency translation additionally increased sales by approximately $75 million, primarily due to the stronger euro in relation to the U.S. dollar. In addition, the formation of two joint ventures with the Volvo Group added approximately $60 million to CVS sales, but this increase was offset by the loss of sales attributable to previously announced divestitures of certain Light Vehicle Systems (LVS) businesses.

Operating loss in the second quarter of fiscal year 2005 was $23 million, compared to operating income of $78 million from the prior year’s second quarter. Contributing to

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the operating loss were $64 million of restructuring costs, of which $62 million were related to new restructuring actions we announced today and in January; a $9 million charge resulting from the MG Rover Group bankruptcy in Europe; and a $6 million environmental remediation charge associated with a former Rockwell facility. Included in operating income in the second quarter of fiscal year 2004 was a gain of $20 million on the sale of the company’s ride control joint venture, an $8 million environmental remediation charge associated with a different Rockwell facility and $6 million of restructuring costs. The benefits to operating income from the higher CVS volumes in the second quarter of fiscal year 2005 were offset by lower LVS volumes as compared to the same period last year and higher net steel costs of approximately $30 million.

Income from continuing operations before special items was $21 million, or $0.30 per diluted share, compared to $31 million, or $0.45 per diluted share a year ago. These results are in line with the guidance the company provided in January 2005.

Income from discontinued operations was $2 million, or $0.03 per diluted share, compared to $1 million, or $0.01 per diluted share last year. Net loss, including discontinued operations, was $33 million, or $0.48 per diluted share, compared to net income of $41 million, or $0.59 per diluted share last year.

 “During the second quarter, we continued to make progress with the aggressive cost-cutting and restructuring initiatives we announced earlier this year,” said McClure. “These initiatives support our efforts to make ArvinMeritor a more lean, flexible, efficient and competitive company.”

Specific business segment financial results include:

• LVS sales were $1,244 million, up $17 million from the same period last year. Foreign currency translation, primarily as a result of the stronger euro, increased sales by approximately $55 million when compared to the same period last year. This was offset by lower North American and Western European production volumes and the loss of approximately $70 million of sales associated with

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divestitures. Operating loss was $54 million, compared to operating income of $50 million in the same period last year. Included in operating income in the second quarter of fiscal year 2005 was $51 million of restructuring costs, of which $49 million related to new restructuring actions, and a $9 million charge associated with the MG Rover Group bankruptcy. Included in operating income in the second quarter of fiscal year 2004 was a $20 million gain on the sale of our ride control joint venture and $3 million of restructuring costs. LVS results in the second quarter of fiscal year 2005 were also unfavorably impacted by lower light vehicle production volumes and higher net steel costs of approximately $10 million.

• CVS sales were $1,032 million, up $263 million, or 34 percent from last year’s second quarter, primarily as a result of stronger commercial vehicle truck and trailer volumes; the formation of two joint ventures with the Volvo Group, which added sales of approximately $60 million; and foreign currency translation, which increased sales by approximately $20 million. North American heavy-duty truck volumes improved by approximately 50 percent when compared to the same period last year, while trailer volumes improved 23 percent over that same period. Operating income was $37 million, compared to $36 million in the same period last year. Included in operating income in the second quarter of fiscal year 2005 was $13 million of new restructuring costs. The benefits of the higher North American truck and trailer volumes were partially offset by higher net steel costs of approximately $20 million and the restructuring charges. Excluding the restructuring charges, operating income would have been $50 million, 39 percent higher than the prior year.

Commenting on CVS’s performance, McClure said, “CVS sales continue to be strong and all of our global regional markets are robust. Excluding the impact of

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restructuring costs, margins in CVS improved to 4.8 percent this quarter, compared with

4.1 percent in our previous quarter. And we expect further margin expansion in the third quarter.”

Update on Restructuring

The company is on schedule with its previously announced workforce reductions of 400-500 positions worldwide. All corporate headcount reductions, and the majority of Light Vehicle and Commercial Vehicle headcount reductions in North and South America, have been completed. In Europe, reductions in salaried employees will continue over the next couple of months, as legal requirements are addressed.

In addition to the five closures or sales that were announced and completed over the last couple of years, ArvinMeritor has targeted 11 other global facilities for consolidation or closure. These actions, for the most part, will affect the LVS business.

“These restructuring actions will help us offset and better position our company for the industry cycles we primarily experience in our Commercial Vehicle business,” said McClure. “Restructuring will help us right-size our company, enabling us to take out excess capacity, reduce fixed costs, increase operational efficiencies and improve our manufacturing footprint.”

Six-Month Summary

For the first six months of fiscal year 2005, sales were $4.4 billion, up $446 million, or 11 percent, compared to the same period last year. Factors increasing sales during the first six months of fiscal year 2005 included higher CVS market volumes, which added approximately $250 million in sales, and currency translation, which increased sales by approximately $190 million — primarily due to the stronger euro in relation to the U.S. dollar. The formation of two joint ventures with the Volvo Group added approximately $115 million to CVS sales, but this increase was offset by sales lost as a result of previously announced divestitures of certain LVS businesses.

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Operating income for the first six months of fiscal year 2005 was $13 million, compared to $120 million in the same period last year.

Operating income in fiscal year 2005 includes $74 million of restructuring costs, of which $62 million relate to new restructuring actions; $14 million of charges resulting from various customer bankruptcies; and the $6 million environmental remediation charge. Included in operating income in the first six months of fiscal year 2004 were the costs associated with the withdrawn tender offer for Dana Corporation of $16 million (before a non-operating gain of $7 million on the sale of Dana stock owned by the company); an environmental remediation charge of $8 million; $7 million of restructuring costs; and the gain on the sale of the company’s ride control joint venture of $20 million.

Loss from continuing operations was $23 million, or $0.33 per diluted share, compared to income from continuing operations of $55 million, or $0.80 per diluted share a year ago. Income from discontinued operations was $8 million, or $0.11 per diluted share, compared to $5 million, or $0.08 per diluted share, last year. Net loss, including discontinued operations, was $15 million, or $0.22 per diluted share, compared to net income of $60 million, or $0.88 per diluted share last year.

Outlook

“The company’s fiscal year 2005 outlook for light vehicle production is 15.6 million vehicles in North America and 16.9 million vehicles in Western Europe, down from 15.8 million units in North America and 17.0 million units in Western Europe as cited in our previous outlook,” said McClure. “The forecast for North American Class 8 truck production is 307,000 units in fiscal year 2005, which is approximately the same as our previous outlook. Our outlook for Western European Heavy and Medium Truck volumes is 421,000 in fiscal year 2005.

“Our sales outlook for fiscal year 2005 remains strong and is expected to be approximately $8.8 billion, up $800 million from fiscal year 2004. This compares to our previous outlook of $8.9 billion. The decrease is principally related to a decline in light vehicle production volumes, offset partially by higher North American truck volumes.

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“Steel continues to be a challenge for us going forward. We expect steel costs, net of recovery, to be approximately $10 million lower than our previous outlook. We are now forecasting net steel costs in fiscal year 2005 to be $100 million higher than the prior year.

“There continue to be a number of factors that make our ability to forecast the second half of the year challenging, including the volatility of light vehicle production volumes, and the unpredictability in the price and recovery of steel costs. Although we expect steel costs to be lower than our previous estimate, we have lowered our full-year continuing operations outlook to $1.40 to $1.60, as a result of lower light vehicle sales volumes.

“This outlook is before special items, including any new restructuring costs, the MG Rover bankruptcy charges and the environmental remediation costs, all of which were recorded in the second quarter of fiscal year 2005. Additionally, the remaining costs associated with these new restructuring actions will be recorded over the next 18 months — this has not been factored into our outlook.

“For the third quarter of fiscal year 2005, our sales forecast is $2.4 billion, andour continuing operations outlook for diluted earnings per shareis in the range of $0.60 to $0.70 per diluted share, compared to $0.61 per diluted share a year ago,” said McClure.

ArvinMeritor, Inc. is a premier $8 billion global supplier of a broad range of integrated systems, modules and components to the motor vehicle industry. The company serves light vehicle, commercial truck, trailer and specialty original equipment manufacturers and related aftermarkets. Headquartered in Troy, Mich., ArvinMeritor employs approximately 31,000 people at more than 120 manufacturing facilities in 25 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/.

###

All earnings per share amounts are on a diluted basis. The company’s fiscal year ends on the Sunday nearest Sept. 30, and its fiscal quarters end on the Sundays nearest Dec. 31, March 31 and June 30. All year and quarter references relate to the company’s fiscal year and fiscal quarters, unless otherwise stated.

This press release also 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. 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 conditions; the demand for commercial, specialty and light vehicles for which the company supplies products; 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); availability and cost of raw materials, including steel; 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 customers and suppliers; the financial condition of the company’s suppliers and customers, including potential bankruptcies; successful integration of acquired or merged businesses; the ability to achieve the expected annual savings and synergies from past and future business combinations; success and timing of potential divestitures; potential impairment of long-lived assets, including goodwill; competitive product and pricing pressures; the amount of the company’s debt; 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; as well as other risks and uncertainties, including, but not limited to, those detailed from time to time in the filings of the company with the Securities and Exchange Commission.

Non-GAAP Measures

In addition to the results reported in accordance with accounting principles generally accepted in the United States of America (GAAP), we have provided information regarding income from continuing operations, diluted earnings per share, segment operating income and margins before special items which are non-GAAP financial measures. These non-GAAP measures are defined as reported income or loss from continuing operations, reported diluted earnings or loss per share and segment operating income plus or minus special items.

We believe these non-GAAP financial measures are useful to both management and investors in the analysis of our results of operations. This non-GAAP measure should not be considered a substitute for the reported results of operations prepared in accordance with GAAP.

The company will host a telephone conference call and Web cast to discuss the company’s fiscal year 2005 second-quarter financial results on Tuesday, May 3, 2005, at 9 a.m. (ET). To participate, call (617) 786-4511 approximately 10 minutes prior to the start of the call. Please reference ArvinMeritor when dialing in to participate. Investors can also listen to the conference call in real time — or for 90 days by recording — by visiting www.arvinmeritor.com.

A replay of the call will be available from 11 a.m. May 3, until midnight, May 5, 2005, by calling (617) 801-6888. Please refer to passcode 31869919.

To access the listen-only audio Web cast, visit the ArvinMeritor Web site at http://www.arvinmeritor.com/ and click on the Web cast link on either the home page or investor page.

ARVINMERITOR, INC.

CONSOLIDATED INCOME STATEMENT

(Unaudited, in millions)

	Quarter Ended March 31,						Six Months Ended March 31,
	2005			2004			2005			2004
	(Unaudited)
Sales	$	2,276		$	1,996		$	4,366		$	3,920
Cost of Sales		(2,124	)		(1,825	)		(4,083	)		(3,600	)
GROSS MARGIN		152			171			283			320
SG&A		(100	)		(99	)		(184	)		(189	)
Gain on Divestitures		—			20			4			20
Environmental Remediation Costs		(6	)		(8	)		(6	)		(8	)
Restructuring Costs		(64	)		(6	)		(74	)		(7	)
Customer Bankruptcies		(5	)		—			(10	)		—
Costs for Withdrawn Tender Offer		—			—			—			(16	)
OPERATING INCOME (LOSS)		(23	)		78			13			120
Equity in Earnings of Affiliates		7			5			13			7
Gain on Sale of Marketable Securities		—			—			—			7
Interest Expense, Net and Other		(30	)		(25	)		(58	)		(51	)
INCOME (LOSS) BEFORE TAXES		(46	)		58			(32	)		83
Benefit (Provision) for Income Taxes		13			(15	)		9			(23	)
Minority Interests		(2	)		(3	)		—			(5	)
Income (Loss) From Continuing Operations		(35	)		40			(23	)		55
Discontinued Operations
Income from Discontinued Operations		2			1			6			5
Gain on sale of Discontinued Operations		—			—			2			—
Income from Discontinued Operations		2			1			8			5
NET INCOME (LOSS)	$	(33	)	$	41		$	(15	)	$	60
DILUTED EARNINGS (LOSS) PER SHARE
Continuing Operations	$	(0.51	)	$	0.58		$	(0.33	)	$	0.80
Discontinued Operations		0.03			0.01			0.11			0.08
Diluted Earnings (Loss) Per Share	$	(0.48	)	$	0.59		$	(0.22	)	$	0.88
Diluted Shares Outstanding		69.1			69.0			69.1			68.5

Note: Prior periods have been restated for discontinued operations.

ARVINMERITOR, INC.

CONSOLIDATED BUSINESS SEGMENT INFORMATION

(In millions)

	Quarter Ended March 31,						Six MonthsEnded March 31,
	2005			2004			2005			2004
	(Unaudited)						(Unaudited)
Sales:
Light Vehicle Systems	$	1,244		$	1,227		$	2,427		$	2,466
Commercial Vehicle Systems		1,032			769			1,939			1,454
Total Sales	$	2,276		$	1,996		$	4,366		$	3,920
Operating Income (Loss):
Light Vehicle Systems	$	(54	)	$	50		$	(55	)	$	77
Commercial Vehicle Systems		37			36			74			67
Segment Operating Income (Loss)		(17	)		86			19			144
Environmental Remediation Costs		(6	)		(8	)		(6	)		(8	)
Costs for Withdrawn Tender Offer		—			—			—			(16	)
Total Operating Income (Loss)	$	(23	)	$	78		$	13		$	120

Note: Prior periods have been restated for discontinued operations.

ARVINMERITOR, INC.

SUMMARY CONSOLIDATED BALANCE SHEET

(In millions)

	March 31, 2005		September 30, 2004
	(Unaudited)
ASSETS
Cash	$	99	$	132
Receivables		1,607		1,478
Inventories		606		523
Other current assets		261		238
Assets of discontinued operations		555		615
Net property		1,056		1,032
Goodwill		822		808
Other assets		836		813
TOTAL ASSETS	$	5,842	$	5,639
LIABILITIES AND SHAREOWNERS’ EQUITY
Short-term debt	$	7	$	3
Accounts payable		1,440		1,366
Accrued and other current liabilities		649		622
Liabilities of discontinued operations		236		282
Other liabilities		852		830
Long-term debt		1,537		1,487
Minority interest		59		61
Equity		1,062		988
TOTAL LIABILITIES AND SHAREOWNERS’ EQUITY	$	5,842	$	5,639

ARVINMERITOR, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited, in millions)

	Six Month Ended March 31,
	2005			2004
OPERATING ACTIVITIES
Income (loss) from continuing operations	$	(23	)	$	55
Adjustments to income from continuing operations
Depreciation and other amortization		93			95
Gain on divestitures		(4	)		(20	)
Gain on sale of marketable securities		—			(7	)
Restructuring costs, net of expenditures		58			(3	)
Pension and retiree medical expense		55			66
Pension and retiree medical contributions		(46	)		(44	)
Changes in receivable securitization and factoring		38			(27	)
Changes in assets and liabilities		(244	)		(84	)
Net cash flows provided by (used for) continuing operations		(73	)		31
Net cash flows provided by (used for) discontinued operations		(130	)		3
CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES		(203	)		34
INVESTING ACTIVITIES
Capital expenditures		(63	)		(63	)
Acquisitions of businesses and investments, net of cash acquired		(22	)		—
Proceeds from dispositions of property and businesses		33			70
Proceeds from sale of marketable securities		—			18
Net investing cash flows provided by (used for) discontinued operations		159			(7	)
CASH PROVIDED BY INVESTING ACTIVITIES		107			18
FINANCING ACTIVITIES
Net change in revolving debt		48			(23	)
Net change in other debt		20			(9	)
Net change in debt		68			(32	)
Proceeds from exercise of stock options		5			5
Cash dividends		(14	)		(14	)
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES		59			(41	)
IMPACT OF CURRENCY ON CASH		4			5
CHANGE IN CASH		(33	)		16
CASH AT BEGINNING OF PERIOD		132			103
CASH AT END OF PERIOD	$	99		$	119

Note: Prior periods have been restated for discontinued operations.

ARVINMERITOR, INC.

SELECTED FINANCIAL INFORMATION — RECONCILATION

Non-GAAP

(Unaudited, in millions)

	Q2 FY 05 Reported			Customer Bankruptcy		Environmental		New Restructuring Actions		Q2 FY05 Adjusted
Sales	$	2,276		$	—	$	—	$	—	$	2,276
Operating Income (Loss)		(23	)		9		6		62		54
Income (Loss) from Continuing Operations		(35	)		7		4		45		21
Diluted Earnings (Loss) Per Share - Continuing
Operations		(0.51	)	$	0.10	$	0.06	$	0.65	$	0.30
Operating Income (Loss)
LVS Operating Income (Loss)	$	(54	)	$	9	$	—	$	49	$	4
CVS Operating Income		37			—		—		13		50
Segment Operating Income (Loss)		(17	)		9		—		62		54
Environmental Remediation Costs		(6	)		—		6		—		—
Total Operating Income (Loss)	$	(23	)	$	9	$	6	$	62	$	54
Operating Margins
LVS		-4.3	%								0.3	%
CVS		3.6	%								4.8	%
Segment Operating Margins		-0.7	%
Total Operating Margins		-1.0	%								2.4	%

ARVINMERITOR, INC.

SELECTED FINANCIAL INFORMATION — RECONCILATION

Non-GAAP

(Unaudited, in millions)

	Q2 FY 04 Reported			Gain on Sale of Business			Environmental		Q2 FY04 Adjusted
Sales	$	1,996		$	—		$	—	$	1,996
Operating Income (Loss)		78			(20	)		8		66
Income (Loss) from Continuing Operations		40			(15	)		6		31
Diluted Earnings (Loss) Per Share - Continuing
Operations	$	0.58		$	(0.22	)	$	0.09	$	0.45
Operating Income (Loss)
LVS Operating Income (Loss)	$	50		$	(20	)	$	—	$	30
CVS Operating Income		36			—			—		36
Segment Operating Income (Loss)		86			(20	)		—		66
Environmental Remediation Costs		(8	)		—			8		—
Total Operating Income (Loss)	$	78		$	(20	)	$	8	$	66
Operating Margins
LVS		4.1	%							2.4	%
CVS		4.7	%							4.7	%
Segment Operating Margins		4.3	%
Total Operating Margins		3.9	%							3.3	%

EX-99.B

FY 2005 2^nd Quarter
Earnings Conference Call
Chip McClure, President, Chairman and CEO
Jim Donlon, Senior Vice President and CFO
Rakesh Sachdev, Senior Vice President Corporate Strategy

May 3, 2005

1

Forward-Looking Statements

This presentation contains “forward-looking statements” as defined in the Private Securities Litigation
Reform Act of 1995. These forward-looking statements are based on currently available competitive,
financial and economic data and management’s views and assumptions regarding future events.  Such
forward-looking statements are inherently uncertain, and 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 conditions; the demand for commercial, specialty and light vehicles for which the company
supplies products; risks inherent in operating abroad, including foreign currency exchange rates and
potential disruption production and supply due to terrorist attacks or acts of aggression; availability and
cost of raw materials, including steel; OEM program delays; demand for and market acceptance of
new and existing products; reliance on major OEM customers; labor relations of the company, its
customers and suppliers; the financial condition of the company’s suppliers and customers, including
potential bankruptcies; successful integration of acquired or merged businesses; achievement of the
expected annual savings and synergies from past and future business combinations; success and
timing of potential divestitures; potential impairment of long-lived assets, including goodwill;
competitive product and pricing pressures; the amount of the company’s debt; the ability of the
company to access capital markets; the 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; as well as other risks and uncertainties, including but not limited to those detailed
herein and from time to time in ArvinMeritor’s Securities and Exchange Commission filings.

2

2^nd Quarter Income Statement

(in millions, except per share amounts)

2005

2004

$

%

Sales

2,276

$               

1,996

$                  

280

$                  

14%

Cost of Sales

(2,124)

(1,825)

(299)

-16%

GROSS MARGIN

152

171

(19)

-11%

SG&A

(100)

(99)

(1)

-1%

Gain on Divestitures

-

20

(20)

Customer Bankruptcy

(5)

-

(5)

Environmental Remediation Costs

(6)

(8)

2

Restructuring Costs

(64)

(6)

(58)

OPERATING INCOME (LOSS)

(23)

78

(101)

-129%

Equity in Earnings of Affiliates

7

5

2

40%

Interest Expense, Net and Other

(30)

(25)

(5)

-20%

INCOME (LOSS) BEFORE INCOME TAXES

(46)

58

(104)

-179%

Benefits (Provisions) for Income Taxes

13

(15)

28

187%

Minority Interests

(2)

(3)

1

33%

Income (Loss) From Continuing Operations

(35)

40

(75)

-188%

Income from Discontinued Operations

2

1

1

100%

NET INCOME (LOSS)

(33)

$                    

41

$                     

(74)

$                    

-180%

DILUTED EARNINGS (LOSS) PER SHARE

Continuing Operations

(0.51)

$                 

0.58

$                  

(1.09)

$                 

-188%

Discontinued Operations

0.03

0.01

0.02

200%

Diluted EPS

(0.48)

$                 

0.59

$                  

(1.07)

$                 

-181%

Three Months Ended March 31,

Better/(Worse)

3

Restructuring Actions

Annual savings estimated at $50 – $60 million.

($ in millions)

LVS

CVS

Total

1Q

2Q

YTD

New Actions

Salaried reduction in force

10

$            

13

$            

23

$            

-

$               

23

$            

23

$            

Facility rationalization

Employee severance

47

6

53

-

16

16

Shutdown costs and other

27

9

36

-

-

-

Total facility rationalization

74

15

89

-

16

16

Asset impairments

23

-

23

-

23

23

Total New Actions

107

28

135

-

62

62

Total Previous Actions

16

-

16

10

2

12

Total Estimated Restructuring Costs

123

$         

28

$            

151

$         

10

$            

64

$            

74

$            

Total Estimated Costs

Total Recorded Fiscal 2005

4

Segment Sales

(in millions)

2005

2004

$

%

Light Vehicle Systems

North America

537

$               

511

$               

26

$                 

5%

Europe

576

606

(30)

-5%

South America

60

44

16

36%

Asia-Pacific and Other

71

66

5

8%

Total Sales

1,244

1,227

17

1%

Commercial Vehicle Systems

North America

618

471

147

31%

Europe

298

210

88

42%

South America

52

29

23

79%

Asia-Pacific and Other

64

59

5

8%

Total Sales

1,032

769

263

34%

Reported Sales

2,276

$            

1,996

$            

280

$               

14%

Better/(Worse)

Quarter Ended March 31,

5

Segment Operating Income

Total Operating Margins

2.4%

3.3%

(0.9)

(in millions)

2005

2004

$

%

Operating Income

Light Vehicle Systems

(54)

$                    

50

$                     

(104)

$                  

-208%

Commercial Vehicle Systems

37

36

1

3%

Segment Operating Income

(17)

86

(103)

-120%

Environmental Remediation Costs

(6)

(8)

2

25%

Operating Income

(23)

$                    

78

$                     

(101)

$                  

-129%

Operating Margins

Light Vehicle Systems

-4.3%

4.1%

(8.4)

Commercial Vehicle Systems

3.6%

4.7%

(1.1)

Segment Operating Margins

-0.7%

4.3%

(5.0)

Total Operating Margins

-1.0%

3.9%

(4.9)

Operating Margins Before Special Items

Light Vehicle Systems

0.3%

2.4%

(2.1)

Commercial Vehicle Systems

4.8%

4.7%

0.1

Better/(Worse)

Quarter Ended March 31,

6

Balance Sheet Highlights

(1)

Net debt is calculated as total debt less fair value of interest rate swaps plus factored and securitized receivables less cash.

(2)

Includes accounts receivable securitization and factored receivables and excludes cash, short-term debt, and assets and liabilities

of discontinued operations.

(3)

Calculated using quarterly average working capital and current quarter annualized sales.

(in millions)

03/31/05

12/31/04

09/30/04

06/30/04

03/31/04

Cash

99

$                           

91

$                           

132

$                        

122

$                        

119

$                        

Short-term Debt

7

$                             

7

$                             

3

$                             

3

$                             

2

$                             

Long-term Debt

1,537

1,516

1,487

1,585

1,527

Total Debt

1,544

$                     

1,523

$                     

1,490

$                     

1,588

$                     

1,529

$                     

Minority Interests

59

62

61

60

64

Equity

1,062

1,170

988

1,123

1,076

Total Debt to Capital

58%

55%

59%

57%

57%

Factored Receivables

15

-

10

9

16

Securitized Receivables

65

1

32

142

225

Net Debt (1)

1,504

1,396

1,364

1,588

1,600

Working Capital  (2)

465

469

293

553

570

Working Capital % of Sales (3)

5.1%

4.6%

5.3%

6.7%

7.2%

7

$                          

Six Months Ended

(in millions)

2005

2004

OPERATING ACTIVITIES

Income (loss) from continuing operations

Adjustments to income (loss) from continuing operations:

Depreciation and amortization

93

95

Other non-cash adjustments

54

(30)

Pension and retiree medical expense

55

66

Pension and retiree medical contributions

(46)

(44)

Changes in assets and liabilities

(244)

(84)

Net cash flows provided by (used for) continuing operations

(111)

58

Net cash flows provided by (used for) discontinued operations

(130)

3

Cash provided by (used for) operations (excluding securitization and factoring)

(241)

61

Changes in receivables securitization and factoring

38

(27)

CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES

INVESTING ACTIVITIES

Capital expenditures

Other investing cash flows provided by continuing operations

Net investing cash flows provided by (used for) discontinued operations

159

(7)

CASH PROVIDED BY INVESTING ACTIVITIES

107

18

$                           

FINANCING ACTIVITIES

Net change  in debt

Proceeds from exercise of stock options

5

5

Cash dividends

(14)

(14)

CASH PROVIDED BY FINANCING ACTIVITIES

$                           

March 31,

Cash Flow Highlights

$                           

(23)

55

$                           

$                        

(203)

34

$                           

$                           

(63)

(63)

$                           

11

88

$                           

68

(32)

$                           

$                           

59

(41)

8

Light Vehicle Systems Net New Business

Implied

Actual

Annual

2004

2005

2006

2007

2008

Cumulative

Growth

January 2005 Guidance

4,818

$         

260

$            

(20)

$            

-

$                 

130

$            

370

$            

1.9%

Pass Through Sales

-

30

(3)

27

23

77

Other Changes, Net (1)

-

1

23

23

6

53

Revised Guidance

4,818

$         

291

$            

-

$                 

50

$              

159

$            

500

$            

2.5%

(1)  Primarily Emissions Technologies

Sales (in millions)

Incremental

9

FY 2005 Commercial Vehicle Production Outlook

(in thousands)

Calendar

Q1

Q2

Q3

Q4

Full Year

Year

North America - Class 8 Trucks (1)

2005 Outlook

74

79

80

74

307

304

2004 Actual

47

54

63

71

235

262

Change

57%

46%

27%

4%

31%

16%

Western Europe - Heavy & Medium Trucks

2005 Outlook

96

108

117

100

421

425

2004 Actual

95

93

98

90

376

377

Change

1%

16%

19%

11%

12%

13%

(1) - Includes U.S., Canada and Mexico

Source: Western Europe - Global Insight

Fiscal Year Ended September 30

10

FY 2005 Light Vehicle Production Outlook

(in millions)

Calendar

Q1

Q2

Q3

Q4

Full Year

Year

North America

2005 Outlook

3.8

4.0

4.2

3.6

15.6

15.7

2004 Actual

3.9

4.2

4.2

3.6

15.9

15.8

Change

-3%

-5%

0%

0%

-2%

-1%

Western Europe (1)

2005 Outlook

4.2

4.3

4.6

3.8

16.9

17.1

2004 Actual

4.3

4.3

4.6

3.7

16.9

16.8

Change

-2%

0%

0%

3%

0%

2%

(1) - Includes Czech Republic

Source: CSM Worldwide, Inc.

Fiscal Year Ended September 30

11

FY 2004 Results and FY 2005 Outlook – Continuing Operations

(in millions, except EPS)

FY 2004

Full Year

Sales

8,033

$                 

-

8,033

$                  

Light Vehicle Systems

4,818

$                        

(30)

-

(5)

Commercial Vehicle Systems

3,215

800

-

825

770

820

Sales

8,033

$                        

8,803

$                 

-

8,853

$                  

Operating Margin

3.2%

2.6%

-

2.8%

Interest Expense

(107)

(120)

-

(119)

Effective Tax Rate

25%

27%

-

27%

Income from Continuing Operations

127

$                           

97

$                     

-

110

$                     

Diluted Earnings Per Share

1.85

$                           

1.40

$                  

-

1.60

$                    

Full Year Outlook (1)

FY 2005

(1)  Outlook does not include the impact of any future acquisitions or divestitures, or the impact of additional

restructuring actions.  Outlook also excludes $0.10 per diluted share of customer bankruptcy write offs, $0.06 per diluted

share of environmental remediation costs and $0.65 of restructuring charges, each of which were recorded in the second

quarter of fiscal 2005.

12

FY 2004 3^rd Quarter Results and FY 2005 3^rd Quarter Outlook – Continuing Operations

(in millions, except EPS)

FY 2004

3rd Quarter

Sales

2,099

$                 

-

2,099

$                  

Light Vehicle Systems

1,237

$                        

40

-

50

Commercial Vehicle Systems

862

225

-

230

265

-

280

Sales

2,099

$                        

2,364

$                 

-

2,379

$                  

Operating Margin

4.0%

3.7%

-

4.0%

Interest Expense

(26)

(30)

-

(31)

Effective Tax Rate

27%

27%

-

27%

Income from Continuing Operations

42

$                              

42

$                     

-

49

$                       

Diluted Earnings Per Share

0.61

$                           

0.60

$                  

-

0.70

$                    

(1)  Outlook does not include the impact of any future acquisitions or divestitures, or the impact of additional restructuring actions.

FY 2005

3rd Quarter Outlook (1)

13

FY 2005 Cash Flow Outlook – Continuing Operations

(in millions)

Income From Continuing Operations

97

$                  

-

110

$               

Adjustments to Income

Depreciation and Other Amortization

190

-

195

Pension and Retiree Medical Expense

110

-

110

Pension and Retiree Medical Contributions

(160)

-

(170)

Changes in Assets and Liabilities

(157)

-

(180)

Cash Provided by Operations

80

-

65

Capital Expenditures

(155)

-

(165)

Free Cash Flow

(75)

$                 

-

(100)

$               

Net Proceeds from Acquisitions and Divestitures (1)

195

$               

-

195

$               

Cash Dividends ($0.40 per share)

(28)

$                 

-

(28)

$                 

(1) Includes sale of Roll Coater and the Automotive Stamping and Components businesses.

Note: Does not include the effects of any changes in A/R securitization and factoring or any future

acquisitions or divestitures.

Full Year

FY 2005

14

Non-GAAP Financial Information

15

Use of Non-GAAP Financial Information

In addition to the results reported in accordance with accounting principles generally accepted in the United States (“GAAP”)
included throughout this presentation, the Company has provided information regarding income from continuing operations,
diluted earnings per share and segment operating income and margins before special items which are non-GAAP financial
measures.  These non-GAAP measures are defined as reported income or loss from continuing operations, reported diluted
earnings or loss per share and segment operating income plus or minus special items.  Other non-GAAP financial measures
include “net debt” and “free cash flow”.  Net debt is defined as total debt less the fair value adjustment of debt due to interest
rate swaps, plus securitized and factored receivables, less cash.  Free cash flow represents net cash provided by operating
activities before the net change in accounts receivable securitized or factored, less capital expenditures.  The Company
believes it is appropriate to exclude the net change in securitized and factored accounts receivable in the calculation of free
cash flow since the sale of receivables may be viewed as a substitute for borrowing activity.

Management believes that the non-GAAP financial measures used in this presentation are useful to both management and
investors in their analysis of the Company’s financial position and results of operations.  In particular, management believes
that net debt is an important indicator of the Company’s overall leverage and free cash flow is useful in analyzing the
Company’s ability to service and repay its debt.  Further, management uses these non-GAAP measures for planning and
forecasting in future periods.

These non-GAAP measures should not be considered a substitute for the reported results prepared in accordance with GAAP.
Neither, net debt nor free cash flow should be considered substitutes for debt, cash provided by operating activities or other
balance sheet or cash flow statement data prepared in accordance with GAAP or as a measure of financial position or liquidity.  
In addition, the calculation of free cash flow does not reflect cash used to service debt and thus, does not reflect funds
available for investment or other discretionary uses.  These non-GAAP financial measures, as determined and presented by
the Company, may not be comparable to related or similarly titled measures reported by other companies.

Set forth on the following slides are reconciliations of these non-GAAP financial measures, if applicable, to the most directly
comparable financial measures calculated and presented in accordance with GAAP.

16

Non-GAAP Financial Information – Net Debt

(in millions)

03/31/05

12/31/04

09/30/04

06/30/04

03/31/04

Short-term debt

7

$                     

7

$                     

3

$                     

3

$                     

2

$                     

Long-term debt

1,537

1,516

1,487

1,585

1,527

Total Debt

1,544

1,523

1,490

1,588

1,529

Less:

Fair value of interest rate swaps

(21)

(37)

(36)

(29)

(51)

Plus:  

Receivable securitization

65

1

32

142

225

Plus:  

Receivable factorization

15

-

10

9

16

   Subtotal

1,603

1,487

1,496

1,710

1,719

Less:

Cash

(99)

(91)

(132)

(122)

(119)

    Net Debt

1,504

$              

1,396

$              

1,364

$              

1,588

$              

1,600

$              

Net debt is calculated as total debt less fair value of interest rate swaps plus factored and securitized receivables less cash.

17

$                        

Non-GAAP Financial Information –

2^nd Qtr FY 05 Results before Special Items

Q2 FY 05   

Reported

Customer

Bankruptcy

Environmental

New

Restructuring

Actions

Q2 FY05

Adjusted

Sales

2,276

$           

-

-

$                        

-

$                        

2,276

$           

Gross Margin

152

4

-

-

156

Operating Income (Loss)

(23)

9

6

62

54

Income (Loss) from Continuing Operations

(35)

7

4

45

21

Diluted Earnings (Loss) Per Share -

Continuing Operations

(0.51)

$            

0.10

$                  

0.06

$                  

0.65

$                  

0.30

$            

Guidance

$0.30 - $0.35

Segment Operating Income (Loss)

LVS Operating Income (Loss)

(54)

$               

9

$                       

49

$                     

4

$                  

CVS Operating Income (Loss)

37

-

-

13

50

Segment Operating Income (Loss)

(17)

9

-

62

54

Environmental remediation costs

(6)

-

6

-

-

Total Operating Income (Loss)

(23)

$               

9

$                       

6

$                       

62

$                     

54

$               

Operating Margins

LVS

-4.3%

0.3%

CVS

3.6%

4.8%

Segment Operating Margins

-0.7%

Total Operating Margins

-1.0%

2.4%

18

Non-GAAP Financial Information –

2^nd Qtr FY 04 Results before Special Items

Q2 FY 04   

Reported

Gain on Sale                     

of Business

Environmental

Q2 FY04

Adjusted

Sales

1,996

$           

-

$                        

-

$                           

1,996

$           

Gross Margin

171

-

-

171

Operating Income (Loss)

78

(20)

8

66

Income (Loss) from Continuing

Operations

40

(15)

6

31

Diluted Earnings (Loss) Per Share -

Continuing Operations

0.58

$            

(0.22)

$                 

0.09

$                       

0.45

$            

Segment Operating Income (Loss)

LVS Operating Income (Loss)

50

$               

(20)

$                    

-

$                           

30

$               

CVS Operating Income (Loss)

36

-

-

36

Segment Operating Income (Loss)

86

(20)

-

66

Environmental remediation costs

(8)

-

8

-

Total Operating Income (Loss)

78

$               

(20)

$                    

8

$                           

66

$               

Operating Margins

LVS

4.1%

2.4%

CVS

4.7%

4.7%

Segment Operating Margins

4.3%

Total Operating Margins

3.9%

3.3%

19

20