July 24, 2013
Mark C. Pigott, Paccar chairman, CEO and chairman of its executive committee, was full of good news Tuesday.
First, his company just posted a quarterly profit just north of $290 million.
Second, the company’s second quarter truck results reflect gradually improving industry truck sales in North America compared to the first quarter of this year. In fact, second quarter truck and parts revenues increased by 10 percent compared to the first quarter.
“Class 8 industry retail sales in the U.S. and Canada were 54,000 units in the second quarter this year compared to 45,000 units in the first quarter,” Pigott says. “Customer truck purchases are focused primarily on replacement vehicles for their fleets. PACCAR delivered 34,800 trucks during the quarter.”
Third, Paccar generated record parts revenue in the second quarter, and Paccar Financial Services results for both the second quarter and the first half were records.
And the good news just kept flowing.
“Looking forward, Paccar truck deliveries in the third quarter are expected to be 1 percent to 2 percent higher compared to the second quarter,” Pigott says. “The benefits of a slightly higher daily build rate are offset by the regular annual two-week factory summer shutdown in Europe.”
“There are a number of encouraging macroeconomic data points in North America that should benefit truck demand. First, construction activity is picking up, specifically, the housing sector. Housing starts in the U.S. are projected to be approximately 1 million units this year,” Pigott continued. “Second, North American auto production is expected to be 15 million vehicles this year. And third, freight tonnage in the U.S. is at a seasonally adjusted record level, beating the previous record set in December of 2011. These economic improvements have enabled many dealers and customers to generate strong results.”