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Meritor CEO Says Auto Parts Makers Must Adapt

12 September 1997

Meritor CEO Says Auto Parts Makers Must Adapt

    FRANKFURT, Sept. 11 -- Larry D. Yost, chairman and chief
executive officer of Meritor Automotive, Inc., the 90-year old automotive unit
of Rockwell, soon to be an independent company, said Wednesday that the auto
industry is undergoing a fundamental change in which auto suppliers must
become proactive partners with automakers.
    Increasingly, automakers are asking their suppliers to take on everything
from product development and engineering, to providing total systems
solutions, Yost said, during a news conference at the Frankfurt Auto Show.
"Automakers want the latest technological developments and innovations in a
cost-effective manner and suppliers are in the best position to deliver those
kinds of solutions to their customers," said Yost.
    "However, while the opportunities are clearly there, suppliers must rise
to the challenge.  The successful suppliers will be the ones who can stay one
step ahead of the customer in developing and providing total solutions while
remaining cost competitive."
    Yost said Meritor's spin off from Rockwell would enable his company to
capitalize on these and a number of other industry trends.
    He also said Meritor will be guided by an entrepreneurial management team
"totally focused on solving the needs of the automotive industry.  Meritor
will be better able to quickly capitalize on industry trends and take full
advantage of opportunities."
    Rockwell is expected to spin off its automotive unit, to be called
Meritor, on September 30, 1997.  Under terms of the transaction, Rockwell
shareholders will receive one share in Meritor for every three shares of
Rockwell stock.  The Meritor stock will be traded on the New York Stock
Exchange beginning Oct. 1, 1997.  "The spin-off will return
Meritor to its roots," said Yost.  "Although our name and logo will change,
our mission will not.  We will remain the leading developer of quality
automotive systems and technology solutions to our customers worldwide."
    Meritor employs more than 16,000 people at 58 manufacturing, research and
sales facilities in 15 countries and had 1996 sales of approximately $3.1
billion, with 44 percent of those sales to international customers.  The
company, headquartered in Troy, Michigan, serves more than 800 original
equipment manufacturers of automobiles, light-, medium-, and heavy-duty trucks
and other vehicles.
    Meritor is a global supplier of a broad range of components and systems
for commercial, specialty and light vehicles.  The company comprises two
businesses: Heavy Vehicle Systems, a leading supplier of drivetrain systems
and components for medium- and heavy-duty trucks, trailers, off-highway
equipment and specialty vehicles including military, bus and coach, and fire
and rescue; and Light Vehicle Systems, a major supplier of roof, door, access
control and seat adjusting systems, electric motors and electronic controls,
suspension systems and wheels for passenger cars, light trucks and sport
utility vehicles.

SOURCE  Rockwell