Meritor bows out of FleetWorks.com

TROY, Mich. (April 17, 2000) — Meritor Automotive rescinded its investment in an Internet aftermarket parts exchange amid concerns over its majority stake in the venture.

“Complete neutrality is key to the success of any vertical exchange concept. As an industry supplier and majority partner, appropriate neutrality in this case could not be reached, based on the broad industry feedback that we’ve received since FleetWorks.com was announced,” said Meritor chairman and CEO Larry D. Yost. “As such, Meritor has decided not to participate in this venture.”

The Web-based exchange, called FleetWorks.com, is intended to let customers and suppliers seek offers and bid on parts and repair work. Operating as a separate company led by a Meritor executive, FleetWorks.com expected to generate $1.5 billion US in revenue in the first year of full operation primarily from transaction fees and advertising.

However, Meritor never was able to allay concerns about whether Meritor products and distributors would be given preferential treatment in the marketplace.

Meritor was the majority investor in the exchange, although the amount was not disclosed. Its partners were a venture capital firm and a Web development company.