ArvinMeritor awarded Volvo axle contract

ArvinMeritor Inc. announced it has been awarded new contracts to supply its Meritor rear drive axles to Volvo Powertrain, a subsidiary of AB Volvo, and Mack Trucks, Inc. The contracts represent sales revenues of more than $150 million annually. Volvo Powertrain is a provider of services and powertrain components to Volvo Trucks North America Inc. and Mack Trucks. The seven-year supply agreement, valued at more than $1 billion, includes a new business win for the company's Commercial Vehicle Systems (CVS) business group to produce proprietary Mack rear drive axles beginning in May 2004 and an extension of its current business as standard rear drive axle supplier to Volvo Powertrain. "This is a significant new business conquest for our company and is further evidence of ArvinMeritor's growing global partnership with Volvo," said CVS president Tom Gosnell.Dana Corp. said last week that Volvo decided not to renew its powertrain contract, which expires at the end of 2003; the axle agreements expire in May 2004. Dana said it received about $293 million last year from the sale of chassis assemblies and axles to Mack. Approximately $120 million of these sales consisted of Dana-manufactured components, and the balance was purchased parts, assembly, and other related fees.