ArvinMeritor will open a new commercial vehicle systems (CVS) facility in Monterrey, Mexico - and close an axle operation in Arden, North Carolina by September 2008.

The new Mexican facility - which will include approximately 400,000 square feet of manufacturing and office space - will provide additional capacity for the company's axle and brake assembly operations and component manufacturing.

"We are looking forward to beginning construction of this new facility," said Carsten Reinhardt, president of CVS for ArvinMeritor. This investment demonstrates our commitment to being a leading supplier in the North American truck industry." Start of production is scheduled for May 2008.

Reinhardt added, "We have worked closely with government officials in the state of Nuevo Leon to expeditiously plan and launch this facility so that we are operational prior to the anticipated upturn in the North American markets."

Alejandro Paez Aragon, secretary of economic development, said, "This action continues to demonstrate that Mexico, in general, and particularly, the State of Nuevo Leon, is a strong competitor for new operations as automotive and truck manufacturers - and their suppliers - expand their operations in North America."

ArvinMeritor's other operations in Mexico include a wheels facility in San Luis Potosi, a roof and door module facility in Puebla, a ride control aftermarket facility in Queretaro, a commercial vehicle aftermarket warehouse in Escobedo and the Sistemas Automotrices de Mexico joint venture in Monterrey which manufactures axles, brakes and drivelines for the North American market.

The Arden closure is part of previously announced restructuring actions in North America and Europe which the company expects to affect 13 plants and 2,800 employees, resulting in an estimated annual run rate savings of $US130-$140m by 2012.

Operations based in Arden will be transferred to the company's facility in Forest City, North Carolina and to the newly announced plant in Monterrey. The company intends to begin transferring work in February 2008.

Fifty-six employees at the Arden facility were advised of the closure today - they will transfer to a Fletcher, North Carolina facility.

Wayne Watson, general manager, operations, North America, said, "ArvinMeritor is taking action to optimise its global manufacturing footprint which will enable us to better serve our customers while reducing our cost structure."

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