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Tenneco Projects Continued Turnaround Despite Difficult Conditions

15 November 2000

Tenneco Automotive Projects Continued Turnaround Despite Difficult Market Conditions

    Company to Web Cast Senior Management Meeting with Financial Community

    NEW YORK, Nov. 15 Tenneco Automotive announced
today that it expects EBITDA for 2001, from operations before restructuring
and other non-operating items, will be in the range of $415 million to
$425 million.  This estimate takes into account an expected 2 percent revenue
decline for 2001, due to slowing North American original equipment production
and continuing softness in the global aftermarket, as well as benefits the
company expects to realize from cost reduction and operational improvement
plans.  The company expects 2000 year-end EBITDA to be between $355 million
and $365 million.
    "We expect these very tough market conditions to continue throughout 2001;
however, we're confident in our ability to maintain our turnaround and deliver
solid results next year," said Mark P. Frissora, chairman and CEO, Tenneco
Automotive.  "Despite facing some of the toughest industry conditions in
recent quarters, we've made progress in our first year as a stand-alone
company.  Based on last-twelve-month performance, we're seeing positive
improvements in key areas including net income, earnings per share, and cash
flow."
    Frissora and his senior management team will outline the company's
strategies and projections for 2001 at a meeting with financial analysts in
New York today at 2 p.m. EST.  The meeting will be web cast live at
http://www.tenneco-automotive.com .
    Difficult market conditions -- including a slowing in original equipment
production, softness in the worldwide aftermarket, a significant decline in
heavy-duty truck production, and unfavorable currency exchanges -- have
impacted the company's recent results.  As a result of these and other
conditions, Tenneco Automotive recently accelerated its cost reduction
efforts.  The company expects that cost reduction initiatives announced in
October 2000, combined with the full implementation of previous restructuring
initiatives will generate annual incremental savings of approximately
$60 million beginning in 2001.  The company also anticipates realizing
additional savings through Six Sigma manufacturing process improvements.
    Tenneco Automotive continues to expand its book of original equipment
business with more than $500 million of incremental global business scheduled
for production through 2005.  Innovative technologies, success in module
supply, and increased vehicle content as a result of new environmental
regulations and safety concerns are driving opportunities in this segment.
    Tenneco Automotive is countering the softness in the North American
aftermarket by introducing new products; repositioning products in both ride
control and exhaust; and launching new promotional programs.  As a result, the
company has increased its North American market share in both ride control and
exhaust to 54 percent and 38 percent respectively, according to third quarter
2000 MEMA data.  The company expects to see improvements in its European
aftermarket business beginning in 2001 as it implements strategies similar to
those used in North America.
    "We are focused on reducing our costs and lowering our debt as quickly as
possible in order to position the company for long-term success," said
Frissora.  "We're taking advantage of increased vehicle content for our
products, driven by environmental and safety concerns; building on our module
supply capability; leveraging our strategic alliances; and pursuing new
technologies that focus on practical applications to help differentiate our
customers' products and services."