(Adds analyst comment and estimates, share price, other details throughout)
CHICAGO, Sept 30 (Reuters) - Auto parts maker ArvinMeritor Inc.. lowered its earnings outlook on Tuesday, citing higher-than-expected costs for new product launches, steel-related interruptions in its Light Vehicle Systems business and other costs.
Its shares tumbled 11.7 percent initially on the New York Stock Exchange and were down $2.27, or 11.2 percent, at $18 at midmorning Tuesday.
Analysts said ArvinMeritor's fourth-quarter update and its initial forecasts for fiscal 2004 and the first quarter were disappointing.
"All of these numbers are well below expectations," David Leiker, an analyst with Robert W. Baird and Co., wrote in a research note. He maintained his "neutral" rating on the stock.
ArvinMeritor said it expects earnings for the fiscal fourth-quarter ending Sept. 30, of 48 cents to 51 cents a share, before the effects of a change in accounting principle.
The company said its outlook includes a net fourth-quarter after-tax gain of $13 million, or 19 cents a share, from an asset sale, as well as $5 million, or 7 cents a share, of expenses from a previously announced restructuring.
It previously had estimated results at 43 cents to 48 cents excluding the gain and restructuring. The company earned 61 cents a share in last year's fiscal fourth quarter.
Analysts' estimates ranged from 33 cents to 48 cents a share, with an average estimate of 44 cents, according to Reuters Research, a unit of Reuters Group Plc.
For fiscal 2003, it estimated earnings at $2 to $2.03 before an accounting change but including the fourth-quarter items.
ArvinMeritor forecast fiscal first-quarter sales of $2 billion and earnings of 25 cents to 30 cents a share. For fiscal 2004, it forecast earnings at $2.20 to $2.40 a share.
The company had earned 47 cents a share in this year's fiscal first quarter and is expected to earn about $1.97 a share for fiscal 2003.
(With additional reporting by Susan Kelly.)