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Morgan Stanley
    Global Automotive Conference




                                                 Phil Martens
                               President, Light Vehicle Systems

                                                     Jim Donlon
                                   Senior Vice President and CFO



1
Forward-Looking Statements
      This presentation 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; 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 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; 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; 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.

2
Agenda


    • Light Vehicle Systems Overview
    • Performance Plus – Enhancing
      Revenue
      – Engineering, Research & Development
      – Product Strategy & Growth


3
LVS Overview



    Today’s Portfolio of Businesses


                                                 Wheels
                Average
                 Above




                                           Door Systems
      Margins

                Average
                 Below




                            Roof                 Chassis
                                                 Systems
                          Systems


                            Low                   High
                                   Growth
4
LVS Overview


     Customer Base Before ET Divestiture

     2006 Sales
     Commercial Vehicle Customers                     Light Vehicle Customers
                                                           DaimlerChrysler
                             Other CVS
                                                                10%
                  Ford 1%
                                                                                             53%
                               15%
         Volkswagen 1%                                                                       Light
                                                                             Volkswagen
                                                                                            Vehicle
                                                                                10%
    General Motors 1%
           Fiat 2%

       PACCAR 2%                                                                  General Motors
                                                                                       9%
     International 3%
         Asian Based
          OEMs 3%
                                                                                  Ford 7%
           DaimlerChrysler
                8%
   47%                                                                   Asian Based OEMs 3%
Commercial                                                          Fiat 3%
                             Volvo 11%
  Vehicle                                                       BMW 2%
                                            Other LVS 9%

5
LVS Overview


     Customer Base After ET Divestiture

     2006 Sales
      Commercial Vehicle Customers                      Light Vehicle Customers
                                                                               33%
                                                        DaimlerChrysler
                                                             8%
                                                                               Light
                         Other CVS                                 Volkswagen
                                                                              Vehicle
                           22%                                          7%
                                                                        Asian Based
                                                                         OEMs 4%
           Ford 1%
                                                                           General Motors 3%
     Volkswagen 1%
                                                                           Ford 3%
    General Motors 1%
                                                                            BMW 1%
            Fiat 2%
         PACCAR 2%
          Asian Based                                                     Other LVS 7%
           OEMs 4%

                International
   67%               5%
Commercial                                                  Volvo 17%
  Vehicle                        DaimlerChrysler
                                      12%
6
LVS Overview

    Top 10 Light Vehicle Platforms After
    ET Divestiture

      Platform                       Key Vehicles
      VW PQ34/35      Golf, Touran, Audi A1, Skoda Octavia
      Hyundai NF/CM   Santa Fe, Sonata
      Renault C       Megane, Scenic
      Dodge DR-DE     Ram
      VW PQ24/25      Polo, Ibiza, Audi A2, Skoda Fabia
      Ford C1         Focus, C-MAX, Volvo S40/V50
      GMT 380/390     TrailBlazer
      Honda CYR2/UM   Accord, Odyssey, Pilot
      VW 7L           Audi Q7
      Peugeot PF1     207

7
LVS Overview


    Door Systems


    25 Million
    Automotive Latches
                                                       25 Million
                                                       Window Regulators




                      15 Million
                      Electric Motors




                                                         4 Million
    Electronic Door
                                                         Door Modules
    Control Module
        (EDCM)




8
LVS Overview



    Complete Range of Roof Systems

    • Large Roof-Opening Systems
       – Near-convertible sensation
         without sacrificing acoustics,
         styling or comfort
           • Multiple glass panels and
             side-guided roller blind
           • Electric anti-squeeze
             technology
           • Integrated beam for
             energy absorption
    • Low-cost Asian sunroof
       – Competitive solution for
         global OEM programs



9
LVS Overview



     Steel Wheels

     • Available up to 24.5 inches
     • Attractive alternative to
       aluminum
        – Safer, stronger and
           more durable
        – Less costly




10
LVS Overview


     LVS EBITDA Margins Improving
     Continuing Operations Before Special Items




                                                  Q1   Full Year

             FY07                             3.2%


             FY06                             2.6%


             FY07 B/(W) FY06                 0.6%       ≥ 1.0%




11
LVS Overview


     Source of YOY Improvement
     EBITDA Margins Before Special Items



                                                              FY08-FY09
                                                     FY07
                                                              (per year)

      2005 Restructuring Benefits                    0.5%          -

      Cost Reductions and Benefits of Performance
                                                     1.8%     2.0 - 2.5%
      Plus, Net of Price Downs

      Customer Disruption                           (TBD)

      Risks/Other                                   (1.0)%   (1.0) - (1.5)%

      Total                                         ≥ 1.0%     ≥ 1.0%




12
LVS Overview



     Revamped Global Contender

     • Reconstruction of operations
        – Competitive footprint
        – Global sourcing strategies
     • Achieving labor efficiency
       gains through lean
       manufacturing
     • Acceleration of improvements
       with Performance Plus




13
Performance Plus
              Top Quartile Financial Performance Among Peer Companies
 Goal




                                                  Steering Committee
              J. Craig   J. Donlon          P. Martens              R. Ostrov         C. Reinhardt    R. Sachdev


                            Operational Excellence                              Commercial Excellence
 Approach




                                     Cost Improvements                             Revenue Enhancement

                                                                                          Product
                                                                                         Strategy &   Aftermarket
                         Materials         Mfg.       Overhead             ER&D
                                                                                          Growth

                             C.             C.
              Sponsors                                   J. Craig        P. Martens      P. Martens     J. Craig
                         Reinhardt      Reinhardt

                                                   Talent Excellence
 Foundation




                                                    Sponsor: R. Ostrov

                                                    Program Office
                                             Sponsors: J. Craig and J. Donlon



14
Engineering, Research & Development

     ArvinMeritor Product Development
     System

     • Align dispersed resources and fragmented practices
        – Reduce operating and product warranty costs
        – Produce more engineering output for the same expense
        – Increase customer satisfaction and new business acquisition
     • Establish central program management office
        – Accelerate implementation of common processes
     • Generate five “Gotta Have” products
        – Create value for customers through innovative, cost-effective
           solutions
        – 126 patents received in 2006


15
Engineering, Research & Development



     LVS Smart Systems

     • Emphasize delivery of solutions through
       systems integration and electronic controls
     • Shift from high-volume mechanical products
       to high-margin electronic products




              Electronics and Controls that Enhance
                       Vehicle Performance
16
Engineering, Research & Development

     LER - Low Energy
     Release Latch



                                                                            Figures of Merit
       Integrated Features              Design Highlights

                                                Fast, low-cost
     • Software controlled                                               • Up to 30% reduction in
                                                 keyless entry
       actuator                                                            package size
     • Power release                                                     • Up to 65% reduction in
                                                              Compact
                                                                           components
     • Power lock                                            packaging
                                                                         • Up to 30% reduction in
     • Power double lock
                                                                           weight
     • Power child safety
                                              Easy door opening
     • Low effort manual                          after crash
       release

      Small Latch Package – Maximum Functional Content
17
Engineering, Research & Development


     Plastic Door Module



                Vision                            Evolution per Customer Strategy

           Integrated Features                      Design Highlights                   Figures of Merit

     • Partial glass guidance
                                                        Pin Less I/S Handle        • Up to 30% reduction in
     • Drum housing / motor
                                                                                     weight**
       attachment
                                                                                   • Reduction of up to 50
     • Pulley / ramp mounting
                                                                       Rail Less     components due to high
     • Locating pins
                                                                       Guide “A”
                                                                                     integration**
     • Wiring harness attachments
                                                                                   • Design flexibility
     • Speaker base
     • Pull handle / trim attachments
     • I/S handle base                                  Pulley Attachments
     • Glass support channel



     ** Compared to steel module.


18
Engineering, Research & Development



     New Offerings in Chassis Systems
                                             Development Programs
     Advanced Engineering Programs


      Integrated                                          Active Roll
        Air Strut                                         Control



                     Modular               Adaptive
                     Corner                Damping
                     System


                    Multilink
                                          Active Air
                    Independent
                                         Suspension
                    Rear
                    Suspension

19
Engineering, Research & Development



     Chassis Systems Integration
         Air Suspension Systems
     1

          – System integration for
            standard air suspension
            and innovative products
            such as Active Air Suspension              1
            and Package Constrained systems
         Active Roll Control Systems
     2

          – Hydraulically controlled stabilizer bar
            systems provide increased safety
            and improved ride and handling                              2
                                                                    3
          – Self contained system reduces complexity
            and allows for easier packaging
         Adaptive Damping Systems
     3

          – Computer-controlled damping system
            uses unique, modular and continuously-variable
            piston to improve ride and handling




20
Engineering, Research & Development

     Expanding Engineering, Research
     and Development




      Establish Technical Center         Expand Technical Center
               in China                         in India




21
Product Strategy & Growth



     ArvinMeritor Global Growth Strategy

     • Triple sales in Asia and with Asian OEMs
       within five years
        – $1 billion+ added sales in Asia Pacific
        – $1 billion in sourcing
        – Healthy mix of local OEMs and global
          OEMs in region
     • Generate compelling new products that
       create exceptional value for customers
     • Increase systems, controls and electronics
       capabilities




22
Product Strategy & Growth

     New Business Wins with Asian
     Customers




                                             First Auto Works




23
Product Strategy & Growth

     Transforming ArvinMeritor – Asia
     Pacific Strategy
     • Aggressively pursue and manage
       growth with focus on higher
       margin product lines
        – Optimize sourcing
        – Local design and engineering
        – Global R&D and shared
          services
     • One regional office for Asia
       Pacific
        – Rakesh Sachdev, named
          President, Asia Pacific


24
Q&A



25

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arvinmeritor Morgan_Stanley_2007_ARM_Final

  • 1. Morgan Stanley Global Automotive Conference Phil Martens President, Light Vehicle Systems Jim Donlon Senior Vice President and CFO 1
  • 2. Forward-Looking Statements This presentation 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; 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 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; 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; 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. 2
  • 3. Agenda • Light Vehicle Systems Overview • Performance Plus – Enhancing Revenue – Engineering, Research & Development – Product Strategy & Growth 3
  • 4. LVS Overview Today’s Portfolio of Businesses Wheels Average Above Door Systems Margins Average Below Roof Chassis Systems Systems Low High Growth 4
  • 5. LVS Overview Customer Base Before ET Divestiture 2006 Sales Commercial Vehicle Customers Light Vehicle Customers DaimlerChrysler Other CVS 10% Ford 1% 53% 15% Volkswagen 1% Light Volkswagen Vehicle 10% General Motors 1% Fiat 2% PACCAR 2% General Motors 9% International 3% Asian Based OEMs 3% Ford 7% DaimlerChrysler 8% 47% Asian Based OEMs 3% Commercial Fiat 3% Volvo 11% Vehicle BMW 2% Other LVS 9% 5
  • 6. LVS Overview Customer Base After ET Divestiture 2006 Sales Commercial Vehicle Customers Light Vehicle Customers 33% DaimlerChrysler 8% Light Other CVS Volkswagen Vehicle 22% 7% Asian Based OEMs 4% Ford 1% General Motors 3% Volkswagen 1% Ford 3% General Motors 1% BMW 1% Fiat 2% PACCAR 2% Asian Based Other LVS 7% OEMs 4% International 67% 5% Commercial Volvo 17% Vehicle DaimlerChrysler 12% 6
  • 7. LVS Overview Top 10 Light Vehicle Platforms After ET Divestiture Platform Key Vehicles VW PQ34/35 Golf, Touran, Audi A1, Skoda Octavia Hyundai NF/CM Santa Fe, Sonata Renault C Megane, Scenic Dodge DR-DE Ram VW PQ24/25 Polo, Ibiza, Audi A2, Skoda Fabia Ford C1 Focus, C-MAX, Volvo S40/V50 GMT 380/390 TrailBlazer Honda CYR2/UM Accord, Odyssey, Pilot VW 7L Audi Q7 Peugeot PF1 207 7
  • 8. LVS Overview Door Systems 25 Million Automotive Latches 25 Million Window Regulators 15 Million Electric Motors 4 Million Electronic Door Door Modules Control Module (EDCM) 8
  • 9. LVS Overview Complete Range of Roof Systems • Large Roof-Opening Systems – Near-convertible sensation without sacrificing acoustics, styling or comfort • Multiple glass panels and side-guided roller blind • Electric anti-squeeze technology • Integrated beam for energy absorption • Low-cost Asian sunroof – Competitive solution for global OEM programs 9
  • 10. LVS Overview Steel Wheels • Available up to 24.5 inches • Attractive alternative to aluminum – Safer, stronger and more durable – Less costly 10
  • 11. LVS Overview LVS EBITDA Margins Improving Continuing Operations Before Special Items Q1 Full Year FY07 3.2% FY06 2.6% FY07 B/(W) FY06 0.6% ≥ 1.0% 11
  • 12. LVS Overview Source of YOY Improvement EBITDA Margins Before Special Items FY08-FY09 FY07 (per year) 2005 Restructuring Benefits 0.5% - Cost Reductions and Benefits of Performance 1.8% 2.0 - 2.5% Plus, Net of Price Downs Customer Disruption (TBD) Risks/Other (1.0)% (1.0) - (1.5)% Total ≥ 1.0% ≥ 1.0% 12
  • 13. LVS Overview Revamped Global Contender • Reconstruction of operations – Competitive footprint – Global sourcing strategies • Achieving labor efficiency gains through lean manufacturing • Acceleration of improvements with Performance Plus 13
  • 14. Performance Plus Top Quartile Financial Performance Among Peer Companies Goal Steering Committee J. Craig J. Donlon P. Martens R. Ostrov C. Reinhardt R. Sachdev Operational Excellence Commercial Excellence Approach Cost Improvements Revenue Enhancement Product Strategy & Aftermarket Materials Mfg. Overhead ER&D Growth C. C. Sponsors J. Craig P. Martens P. Martens J. Craig Reinhardt Reinhardt Talent Excellence Foundation Sponsor: R. Ostrov Program Office Sponsors: J. Craig and J. Donlon 14
  • 15. Engineering, Research & Development ArvinMeritor Product Development System • Align dispersed resources and fragmented practices – Reduce operating and product warranty costs – Produce more engineering output for the same expense – Increase customer satisfaction and new business acquisition • Establish central program management office – Accelerate implementation of common processes • Generate five “Gotta Have” products – Create value for customers through innovative, cost-effective solutions – 126 patents received in 2006 15
  • 16. Engineering, Research & Development LVS Smart Systems • Emphasize delivery of solutions through systems integration and electronic controls • Shift from high-volume mechanical products to high-margin electronic products Electronics and Controls that Enhance Vehicle Performance 16
  • 17. Engineering, Research & Development LER - Low Energy Release Latch Figures of Merit Integrated Features Design Highlights Fast, low-cost • Software controlled • Up to 30% reduction in keyless entry actuator package size • Power release • Up to 65% reduction in Compact components • Power lock packaging • Up to 30% reduction in • Power double lock weight • Power child safety Easy door opening • Low effort manual after crash release Small Latch Package – Maximum Functional Content 17
  • 18. Engineering, Research & Development Plastic Door Module Vision Evolution per Customer Strategy Integrated Features Design Highlights Figures of Merit • Partial glass guidance Pin Less I/S Handle • Up to 30% reduction in • Drum housing / motor weight** attachment • Reduction of up to 50 • Pulley / ramp mounting Rail Less components due to high • Locating pins Guide “A” integration** • Wiring harness attachments • Design flexibility • Speaker base • Pull handle / trim attachments • I/S handle base Pulley Attachments • Glass support channel ** Compared to steel module. 18
  • 19. Engineering, Research & Development New Offerings in Chassis Systems Development Programs Advanced Engineering Programs Integrated Active Roll Air Strut Control Modular Adaptive Corner Damping System Multilink Active Air Independent Suspension Rear Suspension 19
  • 20. Engineering, Research & Development Chassis Systems Integration Air Suspension Systems 1 – System integration for standard air suspension and innovative products such as Active Air Suspension 1 and Package Constrained systems Active Roll Control Systems 2 – Hydraulically controlled stabilizer bar systems provide increased safety and improved ride and handling 2 3 – Self contained system reduces complexity and allows for easier packaging Adaptive Damping Systems 3 – Computer-controlled damping system uses unique, modular and continuously-variable piston to improve ride and handling 20
  • 21. Engineering, Research & Development Expanding Engineering, Research and Development Establish Technical Center Expand Technical Center in China in India 21
  • 22. Product Strategy & Growth ArvinMeritor Global Growth Strategy • Triple sales in Asia and with Asian OEMs within five years – $1 billion+ added sales in Asia Pacific – $1 billion in sourcing – Healthy mix of local OEMs and global OEMs in region • Generate compelling new products that create exceptional value for customers • Increase systems, controls and electronics capabilities 22
  • 23. Product Strategy & Growth New Business Wins with Asian Customers First Auto Works 23
  • 24. Product Strategy & Growth Transforming ArvinMeritor – Asia Pacific Strategy • Aggressively pursue and manage growth with focus on higher margin product lines – Optimize sourcing – Local design and engineering – Global R&D and shared services • One regional office for Asia Pacific – Rakesh Sachdev, named President, Asia Pacific 24