Paccar Earnings Reflect 'Recessionary' Market

Due to slow sales, truck maker Paccar (PCAR) reported first-quarter earnings of $44.3 million or 58 cents per share, well below last year’s $154.9 million or $1.98 per share. Net sales for the quarter were down 34% to $1.5 billion.

"The financial results reflect a recessionary truck market in North America comparable to 1990-1991," Mark Pigott, chairman and chief executive officer said.

The Bellevue, Wash.-based company makes light-, medium- and heavy-duty trucks under the Kenworth, Peterbilt names in the United States, and DAF and Foden in Europe.

Paccar said during the quarter it lowered production at its North American facilities, and is continuing to reduce costs throughout the company.

In contrast, vehicle manufacturer Navistar International said it would return to profitability in its second fiscal quarter ending April 30. (See Executive Briefing, April 24)

Paccar also said the combination of increased vehicle repossessions and lower used truck prices resulted in higher credit losses for Paccar Financial.

Also, Paccar President David Hovind noted the European truck market is also being affected by the slowing global economy, and production is expected to be lower by at least 10% percent in 2001.

(Click here for the full press release.)

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