Traton Q4 Profit Receives Boost From Higher Prices
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Profits at Traton Group rose in the fourth quarter of 2023 on the back of an improved truck market globally and higher prices, the owner of U.S. Class 8 brand International said.
Munich-based Traton’s North American Navistar arm also saw an increase in profits in Q4, although revenue declined on the back of a decrease in truck sales.
Traton posted a profit of $1.164 billion in the most recent quarter, up 11.8% compared with a $1.041 billion profit a year earlier.
The company’s revenue in Q4 totaled $13.837 billion, an increase of 7.7% compared with $12.848 billion a year earlier.
Traton posted a profit of $1.038 billion in 2023. (Traton)
Volkswagen AG’s truck and bus arm sold 88,708 vehicles in Q4, up 0.4% compared with 88,342 in the year-ago period.
In North America, Navistar posted a profit of $204.9 million in the most recent quarter, up 11.9% compared with a $183.1 million profit a year earlier.
The Lisle, Ill.-based company’s revenue in Q4 totaled $2.927 billion, a decrease of 6.15% compared with $3.118 billion a year earlier.
Navistar sold 20,714 vehicles in Q4, down 5.8% compared with 21,984 in the year-ago period.
The company sold 17,818 trucks in the most recent quarter, a decrease of 3.5% compared with 18,459 in the same period a year earlier.
Navistar posted 23,393 orders in Q4, up 93.6% compared with 12,084 in the year-ago period.
Traton, meanwhile, posted a profit of $1.038 billion in 2023, substantially more than double 2022’s $398.7 million.
Profits jumped as a result of the sale of the company’s Russian operations and adjustments in the ownership structure of its financial services group, it said.
Traton’s revenue in 2023 rose 16% year-over-year to $51.1 billion from $43.9 billion in 2022.
The growth in sales revenue was due to higher unit sales of new vehicles, a positive market and product mix, better unit price realization, and growth in the vehicle services business, it said.
Traton’s overall vehicle sales totaled 338,183 in 2023, an increase of 11% from 305,485 in 2022. Truck sales also rose 11%, reaching 281,290 in 2023, compared with 254,300 in 2022.
Levin
This came despite supply chain problems at the company’s Scania and Volkswagen Truck & Bus units, Christian Levin, Traton CEO, said during the company’s quarterly earnings call.
The company’s overall orders in 2023 fell 21% to 264,798 from 334,583 in 2022. The company’s truck orders fell 23% year-over-year to 210,617 from 274,299 in 2022.
Navistar reported a profit of $800.4 million in 2023, up 46.2% compared with $547.4 million in 2022.
Revenue at Navistar in 2023 totaled $12.04 billion, up 5% from $11.45 billion in 2022.
Navistar sold 88,890 vehicles in 2023, up 9% compared with 81,892 a year earlier.
The company sold 75,532 trucks in 2023, an increase of 9% compared with 69,073 in 2022.
Orders at Navistar in 2023 totaled 60,932, down 29% from 86,019 in 2022.
Navistar saw orders fall in 2023 because the majority of the orders for 2023 had already been received in 2022, Traton said. New orders for 2024 could only be accepted to a limited extent on account of the high order backlog, it added.
Levin said during the call that supply chain issues also restricted Navistar’s ability to take on more orders.
Unit sales rose noticeably as a result of the continued high order backlog and the significantly higher production volume, it said.
“The company’s well-filled order book gives confidence for 2024,” Traton said.
Jackstein
Looking forward, Traton’s vehicle sales in 2024 are expected to range between a 5% decrease and 10% increase compared with 2023.
The wide guidance range is partly the result of concerns about the company’s European and North American supply chains in the coming months, Chief Financial Officer Michael Jackstein said during the call.
“With the market environment for trucks generally softening in some regions, we will remain extremely focused in 2024 and capitalize on our strengths,” Levin said in a statement accompanying the results.
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“With our established and committed brands, we focus on customer satisfaction while also working together on further efficiency gains, making us successful as a group,” Levin said, adding: “This year, we will continue growing closer together to leverage our potential. Our strong order book will support us. The orders that we already have will last us into the second half of the year.”
In North America, Levin said on the call, truck sales in 2024 are expected to be strong, with a possible boost from purchases intended to avoid the impact of new emissions rules being introduced by the U.S. Environmental Protection Agency and the California Air Resources Board.
Traton’s guidance for Classes 6-8 sales in 2024 ranges from a decrease of 15% to an increase of 5%, with the high end of the range contrary to analyst expectations of a significant decrease.
