Dana Corporation Chairman Comments on Aftermarket Sale and Cost Saving Opportunities

Nov 15, 2004

    TOLEDO, Ohio, Nov. 15 /PRNewswire-FirstCall/ -- In recent meetings with
analysts and investors, Michael J. Burns, chairman and CEO of Dana Corporation
(NYSE: DCN), confirmed the company's confidence that it will complete the sale
of its automotive aftermarket businesses to an affiliate of The Cypress Group
by the end of November.
    (LOGO: http://www.newscom.com/cgi-bin/prnh/19990903/DANA )
    Mr. Burns reiterated Dana's plans to use proceeds from the sale for an
additional contribution of up to $200 million to the company's pension plans
and for further reduction of Dana's debt, both of which are expected to
accelerate the company's return to investment-grade status.  Additionally,
over the long term, Dana will reinvest in its core businesses to improve its
cost structure and strengthen top-line growth.  This is expected to be done
through consolidation of its manufacturing base, as well as investments in
joint ventures and selective acquisitions.
    Mr. Burns also commented on a series of company actions designed to
significantly reduce costs, including leveraging its global purchasing
efforts, accelerating the deployment of lean manufacturing techniques,
extending its value engineering efforts, and standardizing administrative

    Purchasing Consolidation
    Paul Miller, Dana's new vice president of purchasing, is accelerating the
consolidation of the company's purchasing activities, which were widely
dispersed and operated on a number of different IT systems.
    Dana's cost of direct and indirect materials and purchased services totals
more than $4.5 billion annually.  By fully leveraging its purchasing power,
Dana hopes to realize a significant reduction in these costs over the next
several years, but cannot project the actual cost savings at this time, as the
full impact of this initiative is still being assessed.
     Mr. Burns commented that this initiative has proven timely, as it has
helped to partly offset the higher cost of steel and other commodities that
Dana has faced this year and expects to face in 2005.  Incremental steel costs
in the third quarter of 2004 impacted the company's continuing operations by
approximately $40 million before tax.  Mr. Burns expressed hopes that steel
cost increases will subside in 2005, but reiterated that the company is taking
a conservative approach in planning for next year.

    Lean Manufacturing
    Another significant opportunity for cost savings is lean manufacturing
techniques, including value stream mapping and commonizing on best processes
globally.  Value stream maps graphically chart manufacturing and other
business processes to enable the company to identify and eliminate non-value-
added activity.
    Dana has recently adopted a standardized approach to value stream mapping.
The company has mapped 39 processes to date, and the results are encouraging.
This technique could be applied to hundreds of processes across the company.
If the initial results are indicative, Dana could potentially achieve
substantial savings in the long term.  However, at this early stage, no firm
estimate of savings can be made.

    Value Engineering
    Value analysis/value engineering (VA/VE) represents an additional
opportunity for savings. VA/VE is a process done in conjunction with customers
to redesign components to reduce costs.  Mr. Burns commented that the benefits
of VA/VE can translate not only into cost savings, but also into top-line

    Standardized Administrative Processes
    Mr. Burns also indicated that Dana is working aggressively to standardize
administrative processes in areas such as information technology, finance, and
human resources.  He added that, like purchasing, these processes have been
operating in a very decentralized environment, and standardization will not
only reduce cost, but also improve effectiveness.

    Mr. Burns reiterated that the sale of the automotive aftermarket
businesses is an important strategic step for Dana.  In the near term, the
company will realize the benefits of lower pension and interest expense.  In
addition, while no plans or cost saving estimates have been finalized, Dana is
studying ways to enhance its manufacturing footprint through consolidation,
joint ventures, and selective acquisitions.  This will enable Dana to better
serve its global customers and further improve its cost structure in the
longer term.  Mr. Burns concluded that these efforts, coupled with the ongoing
cost saving initiatives, will better position Dana for the future.
    Dana Corporation is a global leader in the design, engineering, and
manufacture of value-added products and systems for automotive, commercial,
and off-highway vehicles.  Delivering on a century of innovation, the
company's continuing operations employ approximately 45,000 people worldwide
dedicated to advancing the science of mobility.  Founded in 1904 and based in
Toledo, Ohio, Dana operates technology, manufacturing, and customer-service
facilities in 30 countries.  Sales from continuing operations totaled
$7.9 billion in 2003.  Dana's Internet address is http://www.dana.com .

    Forward-Looking Statements
    Certain statements contained in this release constitute "forward-looking"
statements within the meaning of the Private Securities Litigation Reform Act
of 1995.  These statements represent Dana's expectations based on our current
information and assumptions.  Forward-looking statements are inherently
subject to risks and uncertainties.  Dana's actual results could differ
materially from those that are anticipated or projected due to a number of
factors.  These factors include the success and timing of the sale of the
automotive aftermarket businesses; the extent and success of our cost
reduction, lean manufacturing, VA/VE, and cash management programs; increases
in commodity costs, including steel, that cannot be recouped in product
pricing; competitive pressures on our sales and pricing; the ability of our
customers and suppliers to achieve their projected sales and production
levels; and other factors set out in our public filings with the Securities
and Exchange Commission.  Dana does not undertake to update any forward-
looking statements in this release.

SOURCE Dana Corporation

Web Site: http://www.dana.com

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