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                                                                  EXHIBIT 10-b-1

                              DIRECTORS STOCK PLAN

                                       OF

                            MERITOR AUTOMOTIVE, INC.

1.       PURPOSE OF THE PLAN.

         The purpose of the Directors Stock Plan (the Plan) is to link the
         compensation of non-employee directors of Meritor Automotive, Inc.
         (Meritor) directly with the interests of the shareowners.

2.       PARTICIPANTS.

         Participants in the Plan shall consist of directors of Meritor who are
         not employees of Meritor or any of its subsidiaries (Non-Employee
         Director). The term "subsidiary" as used in the Plan means a
         corporation more than 50% of the voting stock of which, or an
         unincorporated business entity more than 50% of the equity interest in
         which, shall at the time be owned directly or indirectly by Meritor.

3.       SHARES RESERVED UNDER THE PLAN.

         Subject to the provisions of Section 10 of the Plan, there shall be
         reserved for delivery under the Plan 350,000 shares of Common Stock of
         Meritor (Shares). Shares to be delivered under the Plan may be
         authorized and unissued Shares, Shares held in treasury or any
         combination thereof.
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         4.       ADMINISTRATION OF THE PLAN.

                  The Plan shall be administered by the Compensation and
                  Management Development Committee of the Board of Directors of
                  Meritor (the Committee). The Committee shall have authority to
                  interpret the Plan, and to prescribe, amend and rescind rules
                  and regulations relating to the administration of the Plan,
                  and all such interpretations, rules and regulations shall be
                  conclusive and binding on all persons.

         5.       EFFECTIVE DATE OF THE PLAN.

                  The Plan shall be submitted to the shareowners of Meritor for
                  approval at the Annual Meeting of Shareowners to be held on
                  February 11, 1998, or any adjournment thereof, and, if
                  approved by the shareowners, shall become effective as of
                  September 30, 1997.

         6.       AWARD OF SHARES.

                  Each Non-Employee Director who is in office on the date (the
                  Distribution Date) of the pro-rata distribution (the
                  Distribution) by Rockwell International Corporation to its
                  shareowners of all the issued and outstanding stock of Meritor
                  shall receive an award of 500 Shares effective immediately
                  after the Distribution. Thereafter, each Non-Employee Director
                  who is elected a director at, or who was previously elected
                  and continues as a director after, any Annual Meeting of
                  Shareowners of Meritor shall receive an award of 1,000 Shares
                  effective immediately after that Annual Meeting. Each
                  Non-Employee Director who is elected a director at any meeting
                  of the Board shall receive effective

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         immediately after that meeting an award of 1,000 Shares if elected
         after the annual meeting and prior to May 1; an award of 750 Shares if
         elected between May 1 and July 31; an award of 500 Shares if elected
         between August 1 and October 31; and an award of 250 Shares if elected
         between November 1 and the next annual meeting. A participant shall not
         be required to make any payment for any Shares delivered under the
         Plan. Upon the delivery of Shares under the Plan, the recipient shall
         have the entire beneficial ownership interest in, and all rights and
         privileges of a shareowner as to those Shares, including the right to
         vote the Shares and to receive dividends thereon. 

         Each Non-Employee Director may elect each year, not later than
         December 31 of the year preceding the year in which the annual award
         of Shares is to be made, to receive the annual grant in the form of
         Shares of restricted stock (Restricted Shares). Upon receipt of
         Restricted Shares, the recipient shall have the right to vote the
         Shares and to receive dividends thereon, and the Shares shall have all
         the attributes of outstanding Shares except that the registered owner
         shall have no right to direct the transfer thereof. Restricted Shares
         shall be held in book-entry accounts subject to the direction of
         Meritor (or if Meritor elects, certificates therefor may be issued in
         the recipient's name but delivered to and held by Meritor) until ten
         days after (i) the recipient retires from the Board after reaching age
         72 and having served at least three years as a director or (ii) the
         recipient resigns from the Board or ceases to be a director by reason
         of the antitrust laws, compliance with Meritor's conflict of interest
         policies, death, disability or other circumstances the Board
         determines not to be adverse to the best interests of Meritor, when
         the restrictions on such book-entry accounts shall be released (or
         any certificates
        

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         issued shall be delivered to the director) and such Shares shall cease
         to be Restricted Shares.

7.       RESTRICTION ON TRANSFER OF SHARES.

         No Shares received by a participant under Section 6 or 9 of the Plan
         may be sold, assigned, transferred, pledged or otherwise encumbered or
         disposed of for a period of six months after receipt of those Shares,
         except in the case of the participant's death or disability during that
         six-month period.

8.       STOCK OPTIONS.

         Each Non-Employee Director who is in office on the Distribution Date
         shall be granted an option to purchase 1,500 Shares effective
         concurrently with the first grant of stock options under Meritor's 1997
         Long-Term Incentives Plan after the Distribution Date. Thereafter, each
         Non-Employee Director who is elected a director at, or was previously
         elected and continues as a director after, any Annual Meeting of
         Shareowners of Meritor shall receive an option to purchase 3,000 Shares
         immediately after that Annual Meeting. Each Non-Employee Director who
         is elected a director at any meeting of the Board shall be granted
         effective immediately after that meeting an option to purchase 3,000
         Shares if elected after the annual meeting and prior to May 1; an
         option to purchase 2,250 Shares if elected between May 1 and July 31;
         an option to purchase 1,500 Shares if elected between August 1 and
         October 31; and an option to purchase 750 Shares if elected between
         November 1 and the next annual meeting. The exercise price for each
         option so



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         granted shall be one-hundred percent (100%) of the closing price (the
         fair market value) of the Shares on the date of grant as reported in
         the New York Stock Exchange -- Composite Transactions (or on the next
         preceding day Shares were traded if not traded on the date of grant).

         The purchase price of the Shares with respect to which an option or
         portion thereof is exercised shall be payable in full in cash, Shares
         valued at their fair market value on the date of exercise, or a
         combination thereof. Each option may be exercised in whole or in part
         at any time after it becomes exercisable; and each option shall become
         exercisable in approximately three equal installments on each of the
         first, second and third anniversaries of the date the option is
         granted. No option shall be exercisable prior to one year nor after ten
         years from the date of the grant thereof; provided, however, that if
         the holder of an option dies, the option may be exercised from and
         after the date of the optionee's death for a period of three years (or
         until the expiration date specified in the option if earlier) even if
         it was not exercisable at the date of death. Moreover, if an optionee
         retires after reaching age 72 and having served at least three years as
         a director, all options then held by that optionee shall be exercisable
         even if they were not exercisable at the optionee's retirement date;
         provided, however, that each such option shall expire at the earlier of
         five years from the date of the optionee's retirement or the expiration
         date specified in the option.

         Options granted under the Plan are not transferable other than (i) by
         will or by the laws of descent and distribution; or (ii) by gift to the
         grantee's spouse or natural, adopted or step-children or grandchildren
         (immediate family members) or to a trust for the benefit of one


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         or more of the grantee's immediate family members or to a family
         charitable trust established by the grantee or a member of the
         grantee's family. If an optionee ceases to be a director while holding
         unexercised options, such options are then void, except in the case of
         (i) death, (ii) disability, (iii) retirement after reaching age 72 and
         having served at least three years as a director, (iv) resignation from
         the Board for reasons of the antitrust laws, compliance with Meritor's
         conflict of interest policies or other circumstances that the Committee
         may determine as serving the best interests of Meritor or (v)
         resignation or removal from the Board in connection with a change of
         control as defined in Article III, Section 13(I)(1) of Meritor's
         By-Laws (Change of Control).

9.       SHARES IN LIEU OF CASH COMPENSATION.

         Each Non-Employee Director may elect each year, not later than December
         31 of the year preceding the year as to which deferral of fees is to be
         applicable, to defer all or any portion of the cash retainer to be paid
         for board or other service in the following calendar year through the
         issuance or transfer of Restricted Shares, valued at the closing price
         on the New York Stock Exchange -- Composite Transactions on the date
         when each payment of such retainer amount would otherwise be made in
         cash. Such Restricted Shares shall be the same as and subject to the
         same provisions as are applicable to the Restricted Shares issued or
         delivered pursuant to Section 6 of the Plan.

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10.      ADJUSTMENTS UPON CHANGES IN CAPITALIZATION.

         If there shall be any change in or affecting Shares on account of any
         merger, consolidation, reorganization, recapitalization,
         reclassification, stock dividend, stock split or combination, or other
         distribution to holders of Shares (other than a cash dividend), there
         shall be made or taken such amendments to the Plan and such adjustments
         and actions thereunder as the Board may deem appropriate under the
         circumstances.

11.      GOVERNMENT AND OTHER REGULATIONS.

         Meritor shall have the right in connection with the delivery of any
         Shares under Section 6 or 9 of the Plan or upon exercise of options
         granted under Section 8 of the Plan to require as a condition of such
         delivery that the recipient represent that such shares are being
         acquired for investment and not with a view to the distribution
         thereof.

12.      AMENDMENT AND TERMINATION OF THE PLAN.

         The Plan may be amended by the Board in any respect, provided that,
         without shareowner approval, no amendment shall (i) materially increase
         the maximum number of Shares available for delivery under the Plan
         (other than adjustments pursuant to Section 10 hereof), (ii) materially
         increase the benefits accruing to participants under the Plan, or (iii)
         materially modify the requirements as to eligibility for participation
         in the Plan. The Plan may also be terminated at any time by the Board.

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13.      MISCELLANEOUS.

         (a)      Nothing contained in the Plan shall be deemed to confer upon
                  any person any right to continue as a director of or to be
                  associated in any other way with Meritor.

         (b)      Notwithstanding any other provision of the Plan, if a Change
                  of Control shall occur, then, unless prior to the occurrence
                  thereof the Board of Directors shall determine otherwise by
                  vote of at least two-thirds of its members, (i) all options
                  then outstanding pursuant to the Plan shall forthwith become
                  fully exercisable whether or not then exercisable and (ii) the
                  restrictions on all Restricted Shares granted under Section 6
                  or 9 of the Plan shall forthwith lapse.

         (c)      To the extent that Federal laws do not otherwise control, the
                  Plan and all determinations made and actions taken pursuant
                  hereto shall be governed by the law of the State of Delaware.


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