ArvinMeritor’s McClure explains company’s rebound

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Speaking at the Detroit Regional Economic Partnership’s annual SAE breakfast this week, Chip McClure, chairman and chief executive officer of ArvinMeritor, attributed the successful rebound of the company to intense restructuring, cost cutting and a focus exclusively on its commercial vehicle core capabilities. McClure said the company’s profitability – increasing its stock price from a low of .32 cents in March 2009 to more than $15 today – is the result of its ability to eliminate waste, improve financials, focus on profitable products and ensure the continuous investment in engineering and R&D.

“Although we saw our markets around the world dramatically drop off last year, as much as 60 to 75 percent, we never stopped investing in our future,” McClure noted in his remarks. “You can’t trade off the future by under-cutting innovation. And I’m sure every engineer in this room will agree with me. Success in this business depends on our ability to find what’s next and what’s better. We have a keen focus on improving fuel efficiency, safety, durability and offering products and technologies that provide our customers with the lowest cost of ownership.”

McClure referenced several recent ArvinMeritor innovations, including a dual mode hybrid for Class 8 trucks, which could improve fuel economy by 20 percent. “While a hybrid passenger car saves 138 gallons of fuel a year, a Class 8 hybrid truck saves over 3,000 gallons,” McClure noted. “That’s the equivalent of taking seven cars off the road.”

McClure, commenting on the increasing amount of demands on Class 8 trucks that now are expected to last more than one million miles, acknowledged his customers need for more. “We need to stay ahead of the market, ahead of the regulations and ahead of changing engine designs,” McClure said. “We recently introduced our new North American 14X axle, which is the lightest-weight axle in its class and provides increased robustness with a 20 percent larger inter-axle differential to handle today’s higher-torque and higher horsepower engines.”

Another key technology area for the commercial vehicle industry is safety-enhancing innovations, including brakes, stopping systems, collision mitigation and stability control. “Safety is such a huge industry issue,” McClure noted. “Professional truck drivers cover some 430 billion miles a year. Each one of them is averaging 100,000 miles or more of driving each year. When you spend that much time behind the wheel, you have to know that your truck is safe and reliable. We’re going to see more demanding regulation on stopping distance of Class 8 tractors going from 355 feet to 250 feet. We have to look at larger brake assemblies and develop new linings that have superior frictional characteristics while retaining longer life.”

McClure acknowledged SAE and the commitment of engineers to solving technology challenges. “Engineering is the link between need and commercial applications and the link between growth and success,” he said.