Meritor Profile
Meritor, Inc. (Meritor) operates as a premier global supplier of a broad range of integrated systems, modules, and components to original equipment manufacturers (OEMs) and the aftermarket for the commercial vehicle, transportation and industrial sectors.
The company serves commercial truck, trailer, military, bus and coach, construction, and other industrial OEMs and certain aftermarkets. The company’s principal products are axles, drivelines, brakes, and suspension systems.
Meritor serves a broad range of customers worldwide, including medium- and heavy-duty truck OEMs, specialty vehicle manufacturers, certain aftermarkets, and trailer producers. The company’s ten largest customers accounted for approximately 75 percent of fiscal year 2021 sales from continuing operations. Sales from operations outside North America accounted for approximately 40 percent of total sales from continuing operations in fiscal year 2021.
Segments
The company operates through two segments, Commercial Truck, and Aftermarket & Industrial segments.
The Commercial Truck segment supplies drivetrain systems and components, including axles, drivelines and braking and suspension systems, primarily for medium- and heavy-duty trucks and other applications in North America, South America, Europe and the Asia Pacific. It also supplies a variety of undercarriage products and systems for trailer applications in North America. This segment includes the company’s aftermarket businesses in the Asia Pacific and South America.
The Aftermarket & Industrial segment supplies axles, brakes, drivelines, suspension parts and other replacement parts to commercial vehicle and industrial aftermarket customers, primarily in North America and Europe. In addition, this segment supplies drivetrain systems and certain components, including axles, drivelines, brakes and suspension systems for military, construction, bus and coach, fire and emergency and other applications in North America and Europe.
Products
Meritor designs, develops, manufactures, markets, distributes, sells, services and supports a broad range of products for use in the transportation and industrial sectors. In addition to sales of original equipment systems and components, the company provides its original equipment, aftermarket and remanufactured products to vehicle OEMs, their dealers (who in turn sell to motor carriers and commercial vehicle users of all sizes), independent distributors, and other end-users in certain aftermarkets.
Axles, Suspension Systems and Drivelines
The company is one of the world's leading independent suppliers of axles for medium- and heavy-duty commercial vehicles, with the leading market position in axle manufacturing in North America, South America and Europe; and is one of the major axle manufacturers in the Asia-Pacific region. The company’s extensive truck axle product line includes a wide range of front steer axles and rear drive axles. The company’s front steer and rear drive axles can be equipped with its cam, wedge or air disc brakes, automatic slack adjusters, and complete wheel-end equipment, such as hubs, rotors and drums.
The company supplies heavy-duty axles in certain global regions for use in numerous off-highway vehicle applications, including construction, material handling, and mining. The company also supplies axles for use in military tactical wheeled vehicles, principally in North America and Europe. These products are designed to tolerate high tonnage and operate under extreme conditions. The company also supplies axles for use in buses, coaches and recreational vehicles, fire trucks and other specialty vehicles in North America, the Asia Pacific and Europe. The company is a leading supplier of bus and coach axles in North America.
The company is one of the major manufacturers of heavy-duty trailer axles in North America. The company’s trailer axles are available in more than 40 models in capacities from 20,000 to 30,000 pounds for virtually all heavy trailer applications and are available with its broad range of suspension modules and brake products, including drum brakes and disc brakes.
The company supplies universal joints and driveline components, including its Permalube universal joint and RPL Permalube driveline, which are maintenance free, permanently lubricated designs used often in the high mileage on-highway market. The company supplies drivelines in North America for use in numerous on-highway vehicle applications. The company also supplies transfer cases for use in specialty vehicles in North America, Turkey and Europe. In addition, the company supplies trailer air suspension systems and products with an increasing market presence in North America. The company supplies transfer cases and drivelines for use in military tactical wheeled vehicles, principally in North America and Europe. In addition, the company supplies advanced suspension modules for use in light-, medium- and heavy-duty military tactical wheeled vehicles, principally in North America, Turkey and Europe.
Brakes and Brake-Related Components
The company is one of the leading independent suppliers of air brakes to medium- and heavy-duty commercial vehicle manufacturers in North America and Europe. In Brazil, Master Sistemas Automotivos Limitada, the company’s 49%-owned joint venture with Randon S. A. Implementos e Participações, is a leading supplier of brakes and brake-related products.
The company, through manufacturing facilities located in North America, the Asia Pacific and Europe, manufactures a broad range of foundation air brakes, as well as automatic slack adjusters for brake systems. The company’s foundation air brake products include cam drum brakes, which offer improved lining life and tractor/trailer interchangeability; wedge drum brakes, which are lightweight and provide automatic internal wear adjustment; air disc brakes, which provide enhanced stopping distance and improved fade resistance for demanding applications; and wheel-end components, such as hubs, drums and rotors.
The company’s brakes and brake system components are used in military tactical wheeled vehicles, principally in North America, Turkey and Europe. The company supplies brakes for use in buses, coaches and recreational vehicles, fire trucks and other specialty vehicles in North America and Europe. The company supplies bus and coach brakes in North America. The company also supplies brakes for commercial vehicles, buses and coaches in the Asia Pacific; and air and hydraulic brakes for off-highway vehicles in North America and Europe.
Electric Vehicle and Other Products
The company supplies electric drive systems that include an electric motor and inverter, power electronics, battery pack, electrified accessories, and all associated software and controls for terminal tractors and medium and heavy-duty trucks and buses.
In addition to the products, the company sells other complementary products, including third-party and private label items, through its aftermarket distribution channels. These products are generally sold under master distribution or similar agreements with outside vendors and include brake shoes and friction materials; automatic slack adjusters; yokes and shafts; wheel-end hubs and drums; ABS and stability control systems; shock absorbers and air springs; and air brakes.
Customers: Sales and Marketing
The company has numerous customers worldwide and has developed long-standing business relationships with many of these customers. Sales to customers that accounted for 10 percent or more of the company’s total sales in the year ended October 3, 2021 included AB Volvo, Daimler AG, and PACCAR, representing approximately 24 percent, 16 percent, and 13 percent, respectively.
Original Equipment Manufacturers (OEMs)
In North America, the company designs, engineers, markets and sells products principally to OEMs, dealers and distributors. While the company’s North American sales are typically direct to OEMs, its ultimate commercial truck customers include trucking and transportation fleets. Fleet customers may specify the company’s components and integrated systems for installation in the vehicles they purchase from OEMs. For all other markets, the company specifically designs, engineers, markets and sells products principally to OEMs for their market-specific needs or product specifications.
The company has established leading positions in many of the markets it serves as a global supplier of a broad range of drivetrain systems, brakes and components. Based on available industry data and internal company estimates, the company’s market-leading positions include independent truck drive axles (i.e., those manufactured by an independent, non-captive supplier) in North America, Europe, South America and India through a joint venture; truck drivelines in North America; truck air brakes in North America and South America (through a joint venture); and military wheeled vehicle drivetrains, suspensions and brakes in North America.
The company’s global customer portfolio includes AB Volvo; Daimler AG; PACCAR; Navistar International Corporation; Oshkosh; Traton Group; CNH Industrial; Ashok Leyland; XCMG; Wabash National; and Gillig.
Aftermarket
The company markets and sells truck, trailer, off-highway and other products principally to, and service such products principally for, OEMs, their parts marketing operations, their dealers and other independent distributors and service garages within the aftermarket industry. The company’s product sales are generated through long-term agreements with certain of its OEM customers and distribution agreements and sales to independent dealers and distributors.
The company’s product offerings allow it to service all stages of its customers’ vehicle ownership lifecycle. In North America, the company stocks and distributes thousands of parts from top national brands to its customers or what it refers to as its all makes strategy. The company’s aftermarket business sells products under various brand names, such as Meritor, Euclid, Trucktechnic, US Gear, AxleTech and Mach.
Joint Ventures
As of September 30, 2021, the company’s continuing operations participated in various non-consolidated joint ventures, including Master Sistemas Automotivos Limitada; Sistemas Automotrices de Mexico S.A. de C.V.; Ege Fren Sanayii ve Ticaret A.S.; and Automotive Axles Limited.
Research and Development
For the year ended October 3, 2021, the company spent $76 million on company-sponsored research, development and engineering.
Patents and Trademarks
The company’s registered trademarks for Meritor and the Bull design are important to its business. Other significant trademarks owned by the company include Euclid and Trucktechnic for aftermarket products.
Seasonality
Historically, for most of the company’s operations, demand has been somewhat lower in the quarters ended September 30 and December 31, when OEM plants may close for summer shutdowns and holiday periods or when there are fewer selling days during the quarter (year ended October 3, 2021). The company’s aftermarket business and its operations in India generally experience seasonally higher demand in the quarter ending March 31.
In addition, the industries in which the company operates have been characterized historically by periodic fluctuations in overall demand for trucks, trailers and other specialty vehicles for which it supplies products, resulting in corresponding fluctuations in demand for its products. Production and sales of the vehicles for which the company supplies products generally depend on economic conditions and a variety of other factors that are outside of its control, including freight tonnage, customer spending and preferences, vehicle age, labor relations and regulatory requirements.
Competition
The company’s major competitors for axles are Dana Incorporated, and in certain markets, OEMs that manufacture axles for use in their own products. Emerging competitors for axles include DTNA’s Detroit Axle, Allison, ZF Friedrichshafen in Europe; and Hande, Fuwa and Ankai in China. The company’s major competitors for brakes are Bendix/Knorr Bremse, ZF and in certain markets, OEMs that manufacture brakes for use in their own products. The company’s major competitors for industrial applications are MAN, Oshkosh, AM General, Marmon-Herrington, Dana Incorporated, Knorr Bremse, Kessler & Co., Carraro, NAF, Sisu and in certain markets, OEMs that manufacture industrial products for use in their own vehicles. The company’s major competitors for trailer applications are Fuwa, Hendrickson and SAF-Holland SA.
History
The company was founded in 1909. It was formerly known as ArvinMeritor, Inc. and changed its name to Meritor, Inc. in 2011.
