European truck market: speed slows, CO2 focus intensifies | articles

Daimler Truck

In the third quarter of the year, Daimler Truck sold 114,917 vehicles, down 11% year-on-year, including 49,176 units in Trucks North America, up 4% YoY, 28,688 units in the Mercedes-Benz segment (-28% YoY), 32,245 units in Trucks Asia (-15% YoY) and 6,677 units of Daimler Buses (-2% YoY). During the first nine months of this year, Daimler Truck sold 336,023 vehicles, down 13% YoY.

In the third quarter of 2024, the truck manufacturer had revenues of €13.1bn, down 5% YoY, and EBIT of €873m, down 27% YoY. The company’s Trucks North America had a positive performance during the reported quarter, with revenue of €5,991m, up 5% YoY, and EBIT of €722m, up 2% YoY, while the Mercedes-Benz segment underperformed, with revenue of €4,398m, down 19% YoY, and EBIT of €80m, down sharply by 82% YoY. In 3Q24, the Trucks Asia segment had revenue of €1,483m, down 11%, and EBIT of €57mn, up 27% YoY, while the Daimler Buses had revenue of €1,234m, up 4%, and EBIT of €140m, up 100% YoY. In terms of operational factors impacting segmental performance, the Mercedes-Benz segment was clearly impacted by significantly lower vehicle sales volume, in particular, in the EU30 region.

In the current reporting year, Daimler Truck expects the global economy to slow slightly compared to the prior year, with the monetary policy environment remaining restrictive and impacting consumer demand and capital investments. After the third-quarter release, the company maintained its unchanged outlook for FY24, with unit sales of 460,000 to 480,000 vehicles, revenue of €53bn to €55bn and reported EBIT significantly and adjusted EBIT slightly below the prior-year level.

Volvo Group

In 3Q24, Volvo Group had net sales of SEK117.0bn, down 12% YoY (-7% YoY when adjusted for currency movements), and adjusted operating income of SEK14.1bn, down 27% YoY, with the respective margin of 12.0%, down from 14.4% in 3Q23. In the reported quarter, the company had deliveries of 46,266 trucks, down 16% YoY, and deliveries of 11,703 units of construction equipment, down 12% YoY. The truck delivery declines were caused in part by the light-duty vehicle change-over in Europe, which commenced this past strong while heavy-duty truck deliveries were down 9% YoY from the very strong comparative base of the prior year.

According to the company, in 3Q24, demand continued to normalise in the majority of Volvo Group’s markets, with freight and construction activity down in many regions across the world relative to the very high levels of the prior year. The company also noted that in 3Q24 order intake for heavy-duty trucks declined by 7% YoY, due to a cautious customer approach towards ordering for 2025 given macroeconomic uncertainties.

Volvo Group adds that with the adjusted production programmes during the first half of this year, the European production volumes are more balanced relative to the current market demand with a positive book-to-bill ratio for the heavy-duty trucks in the third quarter of this year. In North America, the company also adjusted its production volumes to reduce inventories while also commencing the production of the new Volvo VNL range. The company also indicated that demand for buses remained resilient, in particular, for coaches.

In 3Q24, the European truck market continued to decline from the high comparative base of 2023, with freight volumes and freight rates also down from the recent peaks, and the underlying demand is primarily underpinned by the replacement activity. The North American market is driven more by the vocational market segment, whereas demand for on-highway trucks is weaker. The company notes that in North America many retail customers are in a wait-and-see mode, waiting for more clarity on the outlook for the freight market. In India, the truck market was rebounding after the general elections while being also adversely affected by the longer monsoon period, which affected mining and infrastructure projects. There was a high degree of competition in the Chinese freight market, with overcapacity in the transportation sector, high dealer inventories and pricing pressures for diesel-run trucks.

For FY24, Volvo Group sees Europe’s heavy-duty truck market at 300,000, the North American heavy-duty truck market at 290,000 units, the China medium and heavy-duty truck market at 750,000 units, Indian medium and heavy-duty truck market at 370,000 and the Brazilian one at 100,000.

Paccar

In 3Q24, Paccar had net sales and revenues from Trucks, Parts and Other of $7.7bn, down 6% YoY, and respective income before income taxes of $1.0bn, down 24% YoY. Overall, with the Financial Services, the company had sales and revenues of $8.2bn, down 5% YoY, and pre-tax profit of $1.3bn, down 21% YoY. In terms of regional sales, in 3Q24, Europe’s sales were down 20% YoY, and sales in the United States and Canada were down 5% YoY.

In the reported quarter, Paccar had net truck deliveries of 44,900, down 10% YoY, including 25,900 in the United States and Canada, down 6% YoY, 10,000 in Europe, down 31% YoY, and other regional deliveries of 9,000, up 11% YoY. In the first nine months of 2024, the company had net truck deliveries of 141,000, down 8% YoY, with deliveries down in Europe by 31% YoY, up in the United States & Canada by 4% YoY and up in the Other markets by 2% YoY.

Traton

In 3Q24, Traton Operations had sales revenue of €11.9bn, up 5% YoY, and adjusted operating results of €1.2bn, up 21% YoY, with the respective margin of 10.7%, up from 9.2% in 3Q23. In the reported quarter, the company had unit sales of 85,274, up 5% YoY, and incoming orders of 64,353, flat year-on-year. In the reported quarter, Europe was affected by weaker truck demand and unit sales, in particular, in Germany. In the US, demand for medium and heavy trucks remained robust while there was a weaker demand for Class 8 on-highway trucks. Furthermore, there were strong truck sales due to a favourable market environment in South America, in particular Brazil. In 3Q24, sales also benefited from catch-up sales after the prior mirror supply issue.

In the first nine months of 2024, Traton Operations had sales revenue of €34.3bn, up 3% YoY, and adjusted operating result of €3.6bn, up 15% YoY, with a respective margin of 10.4%.