Eaton Corporation unveils breakthrough fuel saving technology at 2002 North American International Auto Show Mon Jan 7, 2002 -

DETROIT… Diversified industrial manufacturer Eaton Corporation (NYSE:ETN) said it has developed a practical method to r ecover energy normally lost during vehicle braking, and convert it into hydraulic power that can be used for vehicle acceleration. Announcement of the breakthrough, which industry experts estimate could result in vehicle fuel savings of 25 to 35 percent in some key applications, was made in Detroit at the 2002 North American International Auto Show yesterday. The technology, called Hydraulic Launch Assist (HLA), has been developed by Eaton in a collaborative program with Ford Motor Company, and was unveile d at the show in the Ford Mighty F -350 TONKA concept truck. The HLA product could be readied for commercial introduction by mid -decade, and Eaton said the total potential for this technology could approach $500 million industry -wide by the end of the decad e. Alexander M. Cutler, Eaton Chairman and Chief Executive Officer said, "We are pleased to be a participant in this unique, potentially game -changing program with Ford and the U. S. EPA. HLA has the potential to significantly impact two critical areas of long term concern to ongoing vehicle development: fuel economy and exhaust emissions. For those reasons, we have already invested millions of dollars in HLA -related work, and recently signed both a technology license agreement and a cooperative research a nd development agreement with the EPA for the development of future generation systems. We are highly optimistic about the future of this technology." HLA is part of a larger hydraulic hybrid development effort for automotive powertrains first announced i n October, 2001. Eaton’s role in the collaborative effort with Ford and the EPA is to provide HLA system architecture, hardware design and electronic controls expertise. HLA works by recovering a portion of the energy normally wasted as heat by the vehicl e's brakes. This converted energy is held in fluid form in an on -board reservoir, or accumulator, until the driver next accelerates the vehicle. Fuel savings occurs when the stored energy is then used in conjunction with the engine -based power in the initi al, high - fuel -consumption acceleration of the vehicle. Eaton officials said acceleration is "brisk", due to the high power density of hydraulics, and energy transfer is virtually transparent to the driver. Hydraulic energy recovery technology for the HLA program was developed primarily within Eaton’s $2.5 billion Fluid Power business, with assistance from the company’s Innovation Centers in Southfield, Michigan and Milwaukee, Wisconsin. Eaton's Fluid Power business has long been an innovator in the design and application of hydraulics and is a worldwide leader in the manufacture and marketing of a complete line of hydraulic systems and components for mobile, industrial, automotive and aerospace applications. Primary products include pumps; motors; electron ic controls; steering units; valves; hydrostatic transmissions; hoses, fittings and assemblies; cylinders; and integrated systems. Eaton Corporation is a global $8 billion diversified industrial manufacturer that is a leader in fluid power systems; electr ical power quality, distribution and control; automotive engine air management and fuel economy; and intelligent truck systems for fuel economy and safety. Eaton has 49,000 employees and sells products in more than 50 countries. This news release contains forward -looking statements concerning the commercial introduction of the HLA product and the total potential for this technology by the end of the decade. These statements should be used with caution. They are subject to various risks and uncertainties, s ome of which are outside the control of the company. Important factors that could cause actual results to differ materially from those indicated by the forward -looking statements include the introduction of competing technologies and unexpected cost, techn ical or marketing difficulties. We do not assume any obligation to update these forward -looking statements.

Contact Information Renald Romain 216 -523 -4736 [email protected]