Welcome to the fourth quarter 2009 ArvinMeritor Earnings conference call. (Operator Instructions) I would like to now turn the call over to Mr. Brett Penzkofer, Senior Director of Investor Relations.

On the call today we have Chip McClure our Chairman, CEO and President and Jay Craig our CFO. The slides accompanying today's call are available at www.arvinmeritor.com. We'll refer to the slides in our discussion this morning. The content of this conference call, which we are recording, is the property of ArvinMeritor Incorporated. It's protected by U.S. and international copyright law and may not be rebroadcast without the express written consent of ArvinMeritor. We consider your continued participation to be your consent to our recording. Our discussion may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Let me refer you to slide two for a more complete disclosure of the risks that could affect our results. To the extent we refer to any non-GAAP measures in our call, you will find the reconciliation to GAAP in the slides on our website. Now, I'd like to turn the call over to Chip.

As we reflect back on 2009, we'll always remember it as one of the most challenging years we've experienced in our history. The dramatic decline in volumes driven by a collapse in both the automotive and trucking industries, as well as in the credit markets, meant that we had to act quickly and readjust our business both financially and operationally. We made drastic changes to how we ran our business and we implemented rigorous cost cutting initiatives throughout the year. The decisions we made were tough and sometimes very unpopular. But the steps we took were necessary and we're seeing them payoff. I'm proud of the many accomplishments we made during the year despite the challenges we faced. And I'm especially proud that even amidst of all the difficulties we never lost sight of our overarching strategy to transform the company with a focus on the global commercial vehicle and industrial markets. We could not have done this, however, without the support of our global workforce. Our people made a lot of sacrifices throughout the year and it was because of their perseverance, commitment and dedication that we were able to deliver on our 2009 priorities while simultaneously managing the company through a global recession. We're now a leaner more efficient company and we're well positioned for growth. Now, let's turn to slide three to review the financial highlights of our fourth quarter and full year 2009. I'm going to review fourth quarter results with you and Jay will cover our 2009 full fiscal year in a few minutes. We're pleased with our fourth quarter performance. Our total sales for the quarter were $984 million, which is up approximately 4% from our third quarter, but down from $1.5 billion or 36% from the fourth quarter of last year. Given the…

I'll start out today with a detailed recap of our fourth quarter results and then review our full year results. Slide 11 compares our fiscal fourth quarter results from continuing operations to the guidance we had previously given you for the quarter, as well as the recast fiscal third quarter results. As you can see in the far right column, compared to our previous outlook we performed by accomplishing stronger revenue, higher earnings, and positive free cash flow. EBITDA before special items increased 43% sequentially to $40 million or 4% of additional revenue. We delivered these results despite the fact that strong positive earnings associated with the wheels business are now reported in discontinued operations. Free cash flow was a positive $22 million, and if you exclude factoring and restructuring it would have been a positive $48 million. We are encouraged by our ability to convert earnings to cash without significant help from working capital this quarter. Slide 12 provides our income statement for continuing operations before special items. We lost $0.28 per share, which was in line with our most recent qualitative guidance. The special item adjustments are detailed in the appendix and include non-cash tax charges of $25 million resulting from one-time adjustments, as well as some restructuring expenses. On a constant currency basis, sales were down year-over-year by 31% due to the effects of the global downturn or markets in Europe, North and South America, and India. This is a stark comparison to the record volumes experienced in Europe and South America during 2008. Nevertheless, we achieved positive income before taxes in the fourth quarter. SG&A decreased by 34% year-over-year, which is relatively consistent with the percentage decrease of revenue as we realized significant savings from cost cutting actions implemented earlier in the year. On a year-over-year…

On slide 23 you'll see the process we've defined and the specific initiatives to improve our ability to execute well through the cycle. During the past year and a half, we've strengthened our operations, supply chain and purchasing team with new leaders and new information systems. The result is a highly collaborative, cross-functional solution that begins and ends with the customer. The first step in the process is to improve our visibility. To do that, we're collaborating with our customers to increase our transparency into their volume and mix and expectations, while at the same time monitoring industry forecasts. We then use advanced IT systems to interpret forecast data and product mix predictions so we can optimize the information we provide to our suppliers. We're also working more closely than ever with our supply base to ensure that they have the information they need and the resources available to manage both up and down cycles. Our supplier risk management process has been in effect for some time and has been very effective in helping us to avoid or minimize costs due to financial or material issues with certain suppliers. And across our manufacturing base we're constantly evaluating our footprint, driving our lean production system and focusing CapEx on core processes like gearing in actual housings that increase our flexibility and responsiveness. The objective of this process is to meet our customer's delivery expectations with zero interruptions while at the same time eliminating premium costs and maintaining our high quality standards. As we see markets in China, India and South America recovering and volumes in North America increasing due to a 2010 emission change, we're confident that the process we put in place will enable us to more efficiently execute through the cycles. In closing, on slide 24 I want to review our 2010 priorities. Looking ahead to 2010 we remain focused on many of the things that have helped us get to where we are today. We'll concentrate on rigorous cost management to realize improved operating leverage, continue our transformation to focus the company on global commercial vehicle and industrial markets, successfully execute the anticipated upturn as global markets recover, drive innovation by accelerating new products and advance fuel efficient technologies, maintain our focus on sustainable, profitable growth, and continue to strengthen the balance sheet. Now let's take some questions.

(Operator Instructions.) Your first question comes from Brian Johnson – Barclays Capital. Brian Johnson – Barclays Capital: Congratulations to Carsten on his big move. With your new segment structure a couple of things. One, how does it tie back to the aspirations you had for CVS margin in the low teens as we think about each of the segments now that we see very good profitability in industrial and challenge profitability in commercial?

I'll start and I'll kind of throw it over to Jay to get into kind of the details. But obviously as we move forward this is the continued transformation of the company to the commercial vehicle side. As we look at that right now as you look at the margins, I think it's safe to say on the commercial truck side a lot of that is in markets that have been down significantly for quite a long period of time, specifically the North American and European markets. And as we look at the other industrial and the aftermarket in trailers, part of it we kind of move forward to future EBITDA targets is to really make sure we've got the proper focus across those products. So as I look at it specifically in the commercial truck side, I think it's somewhat driven because of the volumes you're seeing in the European and North American markets.

I would just add to what Chip stated obviously the industrial and aftermarket trailer business we think are fairly well situated to reap our long-term EBITDA margin targets. But as you look at the commercial vehicle OE business, the North American market has been down here for almost three years, so there's difficult historical comparison. And as you recall, we have done some restructuring of the North American business, opened a new Mexican manufacturing facility, and if you look at our CapEx for this year and the previous year, invested significant capital into upgrading our plants, both in North America and Europe. And I would also just mention that we've previously stated that the European business was a struggle for us and even at peak volumes, although it was turning around. We knew we had quite a bit of work to do behind the scenes to improve that business, we've continued to do that, most recently over the last 12 months moving the Performance Plus oversight office to our European headquarters, and aggressively focused on improving the margins in that business over the last year. So we know the target that we've set out externally and we're continuing to think to make very strong forward progress. Brian Johnson – Barclays Capital: So should we be thinking about commercial truck as a low teens business in an EBITDA cycle production environment in North America and Europe?

I would say, Brian, we don't have clear line of sight to EBITDA margins quite that strong at this point. I think the one thing I would – our target was always driven around the three segments on a combined basis. And with companies like ours where there's a lot of leverage given from the industrial – from the commercial OE business into the industrial and aftermarket business, we tend to focus a lot on full channel profitability as well. Obviously, being strong in OE markets gives us the right to play. For example, in the aftermarket business both in North America and Europe and beginning in South America and China. So sometimes it's difficult to get all of the true cost accounting allocations on a full channel profitability basis. Brian Johnson – Barclays Capital: So can we think about this quarters European and North America truck build rates as the breakeven point for the new commercial truck on the segment? And if so, what's then the likely incremental margin either on a per unit or a percentage basis going forward?

I think that's a fair assessment. We were on the positive side of – slightly positive side to breakeven this quarter. So I think that's a fair assessment that you've made. Brian Johnson – Barclays Capital: Just one final question, what is the submitted cash restructuring expense in your [inaudible] business, and how much of the potential cash issue around divesting it is that driving?

I think if you're referring to the comments I made on the cost of the divestiture, is that what you're referring to, Brian? Brian Johnson – Barclays Capital: Yes.

I think we're still dimensioning that and, as I mentioned, we'll have more information in our K. But we just wanted to communicate that although we have this business to breakeven and the cost to carry, so to say, for us as we evaluate and work through any disposition we think was very manageable, that we do see there'll be some cash outflow associated with this. And as you go through any modeling like this, certain scenarios we play out it could be significant. But we do feel we have the good option of time working for us right now a bit because we have reduced the cost to carry. If you recall, this business was significant negative EBITDA in the past and we've gotten it to breakeven and that has allowed us to be somewhat of a patient seller or a disposer of this business.

Brian, this is Chip, two other things to add to that. One, as Jay said if you look at the performance the last couple quarters I think we've been able to get it up to that breakeven level. And if you look historically some of the other businesses we've divested, such as our light vehicle aftermarket and chassis business, we do kind of look at these and really look at what's the best approach to take on a case-by-case basis to look at that kind of going forward that's for the best for our shareholders kind of going forward. So as we look at this as Jay has said, we have the time to do the proper analysis, we will do the proper analysis, I think hopefully history has demonstrated the fact that as we've done this with some of the past ones we certainly feel we've done the right decisions kind of going forward from the short list perspective.

Your next question comes from Derrick Wenger – Jefferies and Company. Derrick Wenger – Jeffries & Company: Three questions if I could. What is the total size of the bank facilities right now and with the letter credits and the availability?

Well, the total size of the bank facilities, there are several. We have a revolving credit facility, which is $700 million. We obviously, as we stated previously, lost Lehman's commitment in that facility almost a year ago, which reduced that by $34 million so where at $666 million, and then we have the U.S. securitization facility, which is $125 million. But again, the availability to us of that facility varies by the amounts of receivables generated in the U.S. Derrick Wenger – Jeffries & Company: Right so what are the LOCs against the $666 million facility, and what's the availability?

We have LCs of $27 million at the end of the quarter and we have outstanding borrowings under the facility at the end of the quarter of $28 million. Derrick Wenger – Jeffries & Company: Is the balance completely available?

It is available to us on every day of the year except for the four quarter end date when we have restrictions due to the covenant calculation. We cleared that by a very large margin this quarter, and in our 10-K will be as in the past disclosing the fee ratio of compliance. Derrick Wenger – Jeffries & Company: Okay so there's $611 million available?

As of today we said today that's correct. Derrick Wenger – Jeffries & Company: But what about quarter end?

Obviously, we have intra-quarter movements and the demands on borrowing in LC. Derrick Wenger – Jeffries & Company: What was available at quarter end or at year end?

Again, we'll be disclosing that as a ratio in the 10-K. Derrick Wenger – Jeffries & Company: Okay and then restructuring cost that are known for the fiscal year '09, '10 coming and how are those kind of spread out?

In 2010, we're still developing that so I don't – and a part of that is how our strategy on body systems plays out. In 2009, the total restructuring for the year, as far as in cash flow, was $53 million for the year. But again, in 2010 we're still developing that. Derrick Wenger – Jeffries & Company: Okay and I think you mentioned it, but why is the interest expense projected to rise here?

It's because there was an accounting change – method of accounting change that had an impact on our convertible securities. And how you compute the imputed interest expense or implied interest expense embedded in those securities and that will increase our non-cash interest expense for 2010 by $10 million. So you'll start to see on future calls like this a reconciling item on our cash flow statement for the year we expect will be about $10 million. Derrick Wenger – Jeffries & Company: Okay and can we put that kind of pro rata over the four quarters?

I think that would be a fair thing to do, although from a cash perspective remember our interest payments are made semi-annually on that [instance]. Derrick Wenger – Jeffries & Co.: Right, but we could spread the $95 million to $110 million over the four quarters on accrual base?

That's correct.

Your next question comes from Patrick Archambault – Goldman Sachs Patrick Archambault – Goldman Sachs: I just wanted a little bit more clarity on just the tax implication. I understand we've all seen companies with really high tax when they're not [inaudible] and having to pay tax in other jurisdictions where they don't have the same kind of accounting for NOLs and that sort of stuff. But I guess it just seems like your tax bill was several hundred percent when you think about going from positive [inaudible] of 2 million to a net loss. And it also seems that in your guidance you would be sort of expecting something like that too. If you get consensus pre-tax expectations of about [33 million] and your guidance for income tax expense is $40 million to $60 million, which would really imply that either the street is too low or that earnings are going to be negative despite general expectations that things are improving. And so I just wanted to A, sort of get a better sense of what's going on. Are there additional allotment evaluation actions that you're anticipating that are included here. And I guess am I thinking about it the right way in terms of the implications for earnings in 2010?

Obviously the slide 13 we added, we knew this was a complicated subject for us to lower our expectation for people externally. It was very complicated. The attempt to add that chart was to provide the additional color that I think you're asking for. And if you look at slide 13, the income tax on entities that are not subject to evaluation allowance is at an effective rate of 32.4%, so I think pretty consistent with what people would expect on a statutory basis. And then unfortunately we have valuation allowances for most of the countries we operate in Europe and the United States, so a large portion of our business where we have generated losses during this year. The good news with that is as those businesses return to profitability, which we do see sometime in the foreseeable future, we will be realizing those earnings tax free. But in the interim, I think we'll continue to provide a chart like this to help people interpret what our tax situation is. And really this quarter it was driven by many of the emerging markets are coming back very aggressively so we're strongly profitable in those markets where we do have to provide and pay income taxes really, as I said just a moment ago, very close to the statutory rates. And we're just now getting over breakeven in the U.S. market, and so it's probably a bit of time before we become a taxpayer which will be shielded by those NOLs. Patrick Archambault – Goldman Sachs: I guess the implications are there for that kind of a, I guess, diversification and profitability to sort of be sustained at least through the better part of next year just given the tax guidance.

That's correct. I think that's a fair assumption of what we try to do by providing the guidance was to help people understand what we expect in terms of dollars of tax, because we thought the effective rate was just relatively difficult to use in modeling. Patrick Archambault – Goldman Sachs: Just a little bit on restructuring, I know you haven't really provided guidance on it for 2010, but I was looking for at least a little bit more help in how to frame it. It seems like when you look at some of the run rates you've provided, there may be some benefit to annualizing some of the actions you've done in the later part of the year, so that's good. But then you talked about putting some of the temporary cost cuts back in as things improve. So can you just help us get a better sense of how we should think about the cost opportunity here?

I think our hesitancy in giving numerical guidance like we did in the four other categories we did for the year relative to restructuring is we do think on the core business, so the three segments in CVS are restructuring, will be down for this year. But as we have spoken to, we're still assessing various alternatives for body, and as we further evaluate those there could be additional restructuring that we think is required in that business. So as we move on further in the year, we may be able to provide clarity around that. Patrick Archambault – Goldman Sachs:

One of Chip's previous charts we addressed what costs we think cost reductions stick within the business and what may come added back in terms of restoration of salaries and hopefully performance that meets our internal plans of repaying incentive compensation. That was laid out in chart eight I think on the table on the lower left side. Included in those structural cost reductions would be the benefit from the restructuring actions that we've taken both this year and in previous years. Patrick Archambault – Goldman Sachs: But I guess I'm just still trying to get a better understanding. It looks like the run rate of course is higher than what you've done, so if you just did nothing you would still have some 40-odd million of a tailwind from structural cost reductions. But then, I guess asking it a different way, how much of the 48 million that you did in last year would come back in, would it be all? Could we be thinking about restructuring being sort of a net neutral next year or might it be less than that?

I think it's probably most dependent on volumes. I would say we feel internally comfortable with our plans that we've laid out internally in 2010. But if volumes come back as we're seeing in the first quarter, if that continues on into future quarters a lot of those temporary reductions could be lost as we're adding workers back into the hourly workforce. We're having to incur higher incentive comp accruals for our profit sharing plans. So I think it really is dependent on what we see in the volumes throughout the market.

If you remember back at the beginning of the year and obviously in response to the economic questions taking place, there were some temporary things we put in place as far as salary reductions, benefit reductions, and some other things that we did. As I kind of indicated in my comments, we'll look to restore some of those. The structural cost reductions on that slide eight are that ones that, as we look at it, kind of sticky if you will and stay there. But some of the others, as Jay had said, is dependent on volume and some of the others, as we indicated early on in the year, were indeed temporary to make sure that we could work through this economic crisis. And as we kind of go forward into 2010, we look for kind of a reinstatement of those things. So it's really that top line would be the one that we would see that would kind of be maintained longer term. Patrick Archambault – Goldman Sachs: Last real quick one, if I may. I didn't see it anywhere, forgive me if I missed it, but would the production volumes for European and then Class 8 that are underpinning your first quarter guidance?

First of all, as I look at the first quarter, I think if you look at the Class 8 orders that came out in October that were north of 20,000 units, I think we certainly see that there's going to be a bit of a pre-buy there that is taking place before the new emissions regulation. That's here in North America it's going to take place. And do envision that through the balance of this calendar quarter and perhaps even into early next year and it will kind of be readjustment that way. So that's what we're kind of seeing and it's kind of the underpinnings, if you will, for here in North America. And as Jay said, beyond four months it's still somewhat unclear here. We're really kind of looking at the second half of next year for that, again, depending on what happens in the economy here. In Europe, we are starting to see a slow gradual increase or rebound. There's no question it was a significant drop off and it'll take a while to come back. So that one I would say is kind of a slow rebounding as we kind of indicated I think the bottom has been passed and just kind of a slow gradual increase. Nothing driving it like the technology here vis-à-vis the emissions regulation that occurs in 2010. So it's just kind of a slow gradual increase there is what we see in Europe.

Your next question comes from Brett Hoselston – Keybanc. Brett Hoselston – Keybanc Capital Markets: LVS, sounds like the chassis are our remaining operations – excuse me, the remaining operations look like they breakeven at this point in time. Free cash flow positive, neutral at this point?

We have seen some positive benefits from the run off from working capital, but I would say barring that it's roughly neutral to slightly negative. Brett Hoselston – Keybanc Capital Markets: What's left at this point in time? I mean it looks like annualized you've got about $1.2 billion in sales, obviously affected by production. And as you break that down, I know you did quickly earlier, but as you break that down into large chunks what's left at this point in time?

It's really three components and I'm going to list them in the order of significance. It's our body system business that would be the vast majority of the business and they represent roughly 75% to 85% of the total business. And then there is some remaining chassis businesses here in North America that we had an agreement with the OE that they provide parts for on a just-in-time basis. That we would run out those contracts to the end of the agreement, one of which ends in the spring of this year and one about 12 months after that. And then the last piece is a small shock absorber business in Europe. So those are the three components. Brett Hoselston – Keybanc Capital Markets: Where we're at, particularly the body business I would say your largest chunk, where are we at in the divesture process. Have we distributed books on it? Are there indications of interest? Where we at and kind of what are your expectations in terms of timeframe? Is this a fixed 12-month process or could it take longer? Your thoughts there.

Well first of all, Brett, it's very early in the process and there is a great deal of interest out there from a number of different parties on that. We're also in discussion with our customers on that to be very transparent on that. So, that is very early in that. We are evaluating all different options and being very open on that. From a timing perspective, as Jay kind of indicated in his comments, that I think the good news is we've gotten that to where its got minimal impact to the companies and we can take the time to make the right economic decisions. So we're going to take the right steady approach on this going forward on that and really haven't set a defined time on it, we do expect it'll go through much of 2010 and perhaps even beyond that. But again as we look at that what we want to do is to make sure that we factor in the considerations from our customers end, our employees end, and obviously the shareholders end to make sure that we make the right decision going forward on that. Brett Hoselston – Keybanc Capital Markets: Jay, as you look at the EBITDA outlook for the company, it looks as though you're basically suggesting that its going to improve and, therefore, the covenant outlook should improve in a commensurate manner. Is that a fair assessment? Is there anything else in there that you see that might mix that up a little bit?

No, I think that's a very fair assessment and I think we believe that we should remain in compliance for the remainder of the life of that facility. Brett Hoselston – Keybanc Capital Markets: Chip, I think we're fairly well aware that the North American market seems to be improving somewhat, a little bit of pre-buy possibly. But as you look out at the European market and particularly with your primary customer [revolver], what are you thoughts at this point in time? Do you feel like you're confidently at the bottom here and starting to see improvement? Do you still feel somewhat uncertain? What are your thoughts?

I think we're at the bottom and starting to come out. What can't be projected is how quickly we'll come out. There's no question it was significant drop in a very short period of time. I think the bottom has been found and it's kind of moving forward. We are seeing different signs that different economies in Europe are starting to pick up, albeit slowly. I know one of the other factors is there's still some stimulus package going on kind of country by country that are driving some of that. We're also seeing some other things within the economy of different countries over there that are moving up, but I need to continue to emphasize, yes, bottom has been found. We probably passed bottom, but it will be kind of a slow ride up from here throughout Europe kind of going forward. Brett Hoselston – Keybanc Capital Markets: Then finally, Jay, you've made some forecasts in terms of tax expense and cash taxes for 2010 and knowing the complexity of tax accounting, that's pretty bold. And so I'm wondering how confident are you in your income tax and cash income tax outlook? It seems as though, from my perspective and I'm not saying this to offend you, but there are so many moving parts with this tax accounting. I'm wondering do you think you have a high degree of confidence that those numbers are actually going to be correct or would you say that's just your best shot at this point in time?

I would say we're fairly confident or we would have not put them out as guidance. I mean like any guidance it can be adjusted in the future, but the cash and the accrual taxes are really being generated by some operations outside the U.S. in growth markets that have held very steady from probably about six months now. So, and as we look out to those countries, we felt fairly confident to provide guidance within a range. I mean those ranges are still somewhat large, but we just thought people were having such great difficulty in determining what our future tax expense would be. We just thought it would be extremely helpful to kind of provide people what we see going forward.

At this time, I would like to hand the call back over to Mr. Brett Penzkofer for closing remarks.

I'd like to thank everyone for joining the call today and invite you to follow up on any further questions you may have with your communications or investor relations contact. Thank you.

Ladies and gentlemen, thank you for your participation in today's conference call. You may now disconnect. Have a wonderful day.