Paccar Boosts Q4 Net Income, Revenue

A Peterbilt Model 579 equipped with Aurora autonomous technology on display at CES 2022 in Las Vegas. (Connor D. Wolf/Transport Topics)

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Paccar Inc. reported fourth-quarter net income rose 26% and revenue increased by about $1 billion compared with a year earlier. The company cited an improved supply chain leading to increased deliveries over third quarter, and strong gains in its parts and financial services segments.

For the quarter ended Dec. 31, Paccar reported net income of $511.4 million, or $1.47 per diluted share, compared with $405.8 million, $1.17, in the 2020 period.

Revenue reached $6.69 billion compared with $5.57 billion a year earlier.



Paccar Financials q4 2021 by Transport Topics on Scribd

“Paccar reported solid results, beating our and consensus EPS and revenue estimates. Deliveries exceeded our projection, R&D was lower and SG&A [ selling, general, and administrative expenses] was higher,” Matt Elkott, a research analyst with Cowen, wrote in a note.

For the full year, net income rose to $1.85 billion, $5.32, compared with $1.3 billion, $3.74, in 2020.

Revenue climbed to $23.52 billion in 2021 compared with $18.73 billion in 2020.

“Customer demand for the new Kenworth, Peterbilt and DAF trucks introduced in 2021 is very strong,” Paccar CEO Preston Feight said in a release. “Kenworth, Peterbilt and DAF delivered 47,600 trucks in the fourth quarter, 45% higher than in the third quarter, reflecting an improvement in the global supply chain. I am very proud of our employees who have delivered outstanding trucks and transportation solutions to our customers while demonstrating the highest commitment to health and safety.”

Feight

The deliveries included 7,000 trucks that were awaiting components, and were proportional across its markets — the largest of which is North America, followed by Europe.

Paccar noted Class 8 truck industry retail sales in the United States and Canada were 250,000 units in 2021. Kenworth and Peterbilt achieved combined market share of 29.2%.

U.S. and Canada Class 8 retail sales are estimated to be in a range of 250,000-290,000 trucks in 2022, based on good economic growth and strong freight demand, according to the Bellevue, Wash.-based company.

Paccar Parts achieved record fourth-quarter pre-tax income of $306.4 million, 38% higher than the $222.5 million compared with a year earlier. Revenue hit a record $1.31 billion compared to $1.07 billion in the 2020 period.

“Paccar Parts provides strong profitability through all phases of the business cycle,” Paccar Parts General Manager David Danforth said. “Paccar Parts’ long-term growth reflects investments in distribution and technology, initiatives such as e-commerce, TRP all-makes parts, and a growing population of integrated and connected Paccar vehicles with Paccar MX engines.”

The company reported it will open a new 260,000-square-foot parts distribution center in Louisville, Ky., this year to enhance parts availability for customers.

Paccar Financial Services said it offers competitive retail financing to Paccar truck brands Peterbilt, Kenworth and, in Europe, DAF dealers and customers. PFS has a portfolio of 204,000 trucks and trailers, with total assets of $15.42 billion.

PacLease, a major full-service truck leasing company in North America and Europe with a fleet of more than 39,000 vehicles, is included in this segment.

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PFS achieved record fourth-quarter pretax income of $134.6 million, more than double the $63.8 million earned a year earlier. Revenue from financial services slipped to $390.4 million compared with $432.6 million in the same quarter of 2020.

Paccar noted it is increasing its investment in clean diesel and electric powertrain technologies, autonomous systems, connected vehicle services, next-generation manufacturing and distribution capabilities.

Feight said during the earnings call DAF is developing a hydrogen fueled internal combustion engine.

“And so that has nearly zero CO2 output. It’s really just some trace CO2 from the lube oil stuff,” he said. “And I think we want that out there as an opportunity so that we can work with the governments and see what’s going to be acceptable and what’s going to provide our customers the right benefits. We think it’s early days and preselecting the right answer is not necessary.”

Earlier, Paccar’s proprietary diesel engines in North America emerged from Europe. Its DAF brand had been building engines since 1957. In 2010, Paccar, based on DAF’s experience, launched its MX series engines in North America. Could it do the same with a hydrogen ICE?

 

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