DOW JONES NEWSWIRES

ArvinMeritor Inc. (ARM) fiscal first-quarter net loss widened amid a write-down at its to-be-shed light-vehicles business and slumping demand.

The auto-parts maker also announced a fresh round of cost cutting, including suspending its quarterly dividend. Such a move will save ArvinMeritor about $29 million a year. Prior moves include last week's announcement of 1,500 jobs, extended shutdowns and reduced work weeks.

As auto manufacturers keep cutting production and consumers put off buying new cars, auto-parts makers have seen demand drop steadily and fears have increased about bankruptcy filings among the group. U.S. auto sales in January hit a 27-year low, raising fresh questions about the future of the Detroit Three and the viability of the government's bailout program.

For the quarter ended Dec. 28, ArvinMeritor posted a net loss of $991 million, or $13.71 a share, compared with a prior-year net loss of $12 million, or 17 cents a share. Excluding items including the light-vehicle write-down, the loss would have been 77 cents.

Revenue slumped 18% to $1.37 billion, with 7 percentage points of the decline due to the weaker dollar.

Analysts polled by Thomson Reuters had been expecting a 6-cent loss on revenue of $1.14 billion.

ArvinMeritor's commercial-vehicle business had been holding up results, but sales there fell 11% in the latest quarter.

Revenue dropped 29% at the light-vehicle segment. The company shelved plans this fall to spin off the segment, then said last month it would reorganize the unit and try to sell it off in pieces. That reorganization, as well as the pulling of already-bleak guidance, led a ratings agency to push its grades on ArvinMeritor further into junk territory.

The company remains "intensely focused" on maintaining liquidity and expects to be in compliance with its financial covenants.

Shares closed Tuesday at $1.81 and were inactive premarket. The stock is down nearly 90% since September.

-By David Benoit and Katherine Wegert, Dow Jones Newswires; 201-938-2472; david.benoit@dowjones.com

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