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                                                                  EXHIBIT 10-c-1

                            MERITOR AUTOMOTIVE, INC.
                           INCENTIVE COMPENSATION PLAN

1.       PURPOSES.

                  The purposes of the Incentive Compensation Plan (the "Plan")
         are to provide a reward and an incentive to employees in managerial,
         staff or technical capacities who have contributed in the then-current
         fiscal year and, in the future, are likely to contribute to the success
         of the Corporation and to enhance the Corporation's ability to attract
         and retain outstanding employees to serve in such capacities.

2.       DEFINITIONS.

                  For the purpose of the Plan, the following terms shall have
         the meanings shown:

                  (a) Board of Directors. The Board of Directors of Meritor.

                  (b) Committee. The Compensation and Management Development
         Committee, designated by the Board of Directors, consisting of three or
         more members of the Board of Directors who are not eligible to
         participate in the Plan.

                  (c) Corporation. Meritor and such of its subsidiaries and
         affiliates as may be designated by the Board of Directors.

                  (d) Employees. Persons in the salaried employ of the
         Corporation (including those on authorized leave of absence) during
         some part of the fiscal year for which an award is made. Unless also an
         employee of the Corporation, no member of the Board of Directors shall
         be eligible to participate in the Plan.

                  (e) Meritor. Meritor Automotive, Inc.

                  (f) Stock. Common stock of Meritor.
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3.       AWARDS.

                  (a) The Chief Executive Officer of Meritor shall submit to the
         Committee, within 35 days after the end of each fiscal year,
         recommendations concerning awards for that fiscal year.

                  (b) The Committee, in its discretion, shall annually following
         the close of the immediately preceding fiscal year, determine (i) the
         extent to which awards, if any, shall be made; (ii) the employees to
         whom any such awards shall be made; (iii) the amount of any award; and
         (iv) the form, terms and conditions of awards. The Committee may
         determine, among other things, whether and to what extent awards shall
         be paid in installments and in cash or in Stock or partly in cash and
         partly in Stock. Any Stock delivered in payment, in whole or in part,
         of an award may, at the Committee's discretion, be subject to such
         restrictions as the Committee deems appropriate.

                  (c) The Corporation shall promptly notify each person to whom
         an award has been made and pay the award in accordance with the
         determinations of the Committee.

                  (d) A cash award may be made with respect to an employee who
         has died. Any such award shall be paid to the legal representative or
         representatives of the estate of such employee.

 4.      AWARDS IN STOCK.

                  (a) Meritor shall make available, as required, Stock to meet
         the needs of the Plan. The total number of shares of Stock which may be
         awarded under the Plan shall not exceed 300,000, except as provided in
         paragraph (b) below. Such shares may consist in whole or in part of
         unissued or reacquired shares. Stock subject to an award which lapses
         or is forfeited, for any reason, shall be available for further awards
         under the Plan.

                  (b) If any change shall occur in or affect Stock subject to or
         awarded under the Plan on account of a merger, consolidation,
         reorganization, recapitalization, reclassification, stock dividend,
         stock split or combination, or other distribution to common shareowners
         (other than a cash dividend), the Board of Directors may make such
         adjustments in the total number of shares subject to or awarded under
         the Plan as may be reasonably appropriate in the circumstances.

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5.       FINALITY OF DETERMINATIONS.

                  The Committee shall have the power to administer and interpret
         the Plan. All determinations, interpretations and actions of the
         Committee and all actions of the Board of Directors under or in
         connection with the Plan shall be final, conclusive and binding upon
         all concerned.

6.       AMENDMENT OF THE PLAN.

                  The Board of Directors shall have the power, in its sole
         discretion, to amend, suspend or terminate the Plan at any time, except
         that:

                  (a) No such action shall adversely affect rights under an
         award already made, without the consent of the person affected; and

                  (b) Without approval of the shareowners of Meritor, the Board
         of Directors shall not increase the total number of shares of Stock
         subject to the Plan (except as provided in paragraph 4(b)).

7.       MISCELLANEOUS.

                  (a) A majority of the members of the Committee shall
         constitute a quorum. The Committee may act by the vote of a majority of
         a quorum at a meeting, or by a writing or writings signed by a majority
         of the members of the Committee.

                  (b) Notwithstanding any other provision of the Plan, if a
         Change of Control (as defined in Article III, Section 13 (I)(1) of
         Meritor's By-Laws) 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 unpaid installments of any
         awards made under the Plan prior to such Change of Control shall
         forthwith become due and payable and (ii) any restrictions on any Stock
         delivered in payment, in whole or in part, of any awards made under the
         Plan prior to such Change of Control shall forthwith lapse.

                  (c) The Corporation shall bear all expenses and costs in
         connection with the operation of the Plan.

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