ArvinMeritor Shares Rise After Goldman Upgrades

"We think we are still in the middle phase of a cyclical rally and would use any weakness to build positions," he wrote.

He also downgraded shares of the parts supplier BorgWarner Inc. to "Neutral" from "Buy," saying shares have approached a fair price. BorgWarner shares fell 50 cents to $31.33.

Auto parts suppliers have been hit hard by the auto downturn, as automakers reduce production to cope with falling sales. General Motors Corp. has shut down numerous factories in the U.S. until mid July, while Chrysler Group LLC ceased all production while under Chapter 11 bankruptcy protection.