ArvinMeritor Plans to Enter Two Axle Joint Ventures with Volvo

Continues Expansion of Global Manufacturing Presence With Key Global Vehicle Maker

TROY, Mich., Oct. 27 -- ArvinMeritor, Inc. has announced a memorandum of understanding with the Volvo Group to create two new joint ventures. The joint ventures would expand ArvinMeritor's capacity to produce commercial vehicle drive axles. Volvo is one of the world's largest truck manufacturers and is based in Goteborg, Sweden.

It is intended that in 2004, the two new joint ventures, owned jointly by ArvinMeritor and Volvo, would assume control and operation of two Volvo Group manufacturing operations in Lyon, France. ArvinMeritor management would operate the two facilities -- an axle plant and a foundry.

Details of the pending agreement have yet to be finalized. The new arrangement would result in the manufacture and distribution of more than 100,000 axles annually.

"This is truly a win-win-win business arrangement: A win for end-user customers, a win for the Volvo Group and a win for ArvinMeritor and its shareowners. Our long-term supply agreement with Volvo is being renewed and expanded," stated Brad Arnold, vice president and general manager of ArvinMeritor's Commercial Vehicle Systems axle business.

"We would retain the Volvo hub reduction products utilizing Volvo and Renault VI technology, and merge them with ArvinMeritor's 100-year history of making the most advanced, highly engineered drive and steer axles," added Arnold.

A portion of non-drive axles currently made at Volvo's Koping, Sweden, facility, would be shifted to production at ArvinMeritor's Lindesberg, Sweden, facility and to the St. Priest joint venture.

Volvo views the new ventures as another step in its strategic outsourcing of commercial axle manufacturing. In late 1998, ArvinMeritor acquired Volvo's commercial axle manufacturing facility in Lindesberg, Sweden. As part of that transaction, ArvinMeritor entered a long-term supply agreement with Volvo for heavy-duty drive axles. According to Arnold, the Lindesberg plant integration into ArvinMeritor's global axle manufacturing network has been a successful one.

"We have realized the value of ArvinMeritor's commitment to advanced axle engineering and manufacturing," stated Lars-Goran Moberg, CEO for Volvo Powertrain, which is responsible for the manufacturing of axles, drivelines, engines and transmissions within the Volvo Group. "Our confidence has grown in ArvinMeritor's ability to serve our global customer base."

In 2000, AB Volvo acquired Renault Vehicules Industriels SA (Renault VI and its subsidiary Mack Trucks, Inc.). All OEMs were customers of ArvinMeritor.

With this action, ArvinMeritor becomes one of Volvo's largest global suppliers, providing more than 300,000 axles for commercial truck applications in North America, Europe, Australia, Brazil and India.

ArvinMeritor, Inc. is a premier $7-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. In addition, ArvinMeritor is a leader in coil coating applications. The company is headquartered in Troy, Mich., and employs 32,000 people at more than 150 manufacturing facilities in 27 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: www.arvinmeritor.com .