Document and Entity Information
Document and Entity Information | ||
3 Months Ended
Mar. 31, 2010 | Apr. 30, 2010
| |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | 2010-03-31 | |
Document Fiscal Year Focus | 2,010 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | PCAR | |
Entity Registrant Name | PACCAR INC | |
Entity Central Index Key | 0000075362 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 364,898,310 |
Consolidated Statements of Inco
Consolidated Statements of Income (USD $) | ||
In Millions, except Per Share data | 3 Months Ended
Mar. 31, 2010 | 3 Months Ended
Mar. 31, 2009 |
Investment income | 4.5 | $8 |
Provision for losses on receivables | 21.7 | 25 |
Income Before Income Taxes | 96 | 36.6 |
Income Taxes | 27.7 | 10.3 |
Net Income | 68.3 | 26.3 |
Net Income Per Share: | ||
Basic | 0.19 | 0.07 |
Diluted | 0.19 | 0.07 |
Weighted Average Common Shares Outstanding: | ||
Basic | 364.6 | 363.1 |
Diluted | 365.7 | 364 |
Dividends declared per share | 0.09 | 0.18 |
TRUCK AND OTHER: | ||
Net sales and revenues | 1984.3 | 1730.4 |
Cost of sales and revenues | 1767.8 | 1561.1 |
Research and development | 54.8 | 52.3 |
Selling, general and administrative | 94.1 | 88.4 |
Interest and other expense, net | 4.2 | 15.3 |
Costs and Expenses, Total | 1920.9 | 1717.1 |
Income Before Income Taxes | 63.4 | 13.3 |
FINANCIAL SERVICES: | ||
Interest and fees | 110 | 132.2 |
Operating lease, rental and other income | 136.4 | 123.6 |
Revenues | 246.4 | 255.8 |
Interest and other borrowing expenses | 57.1 | 91.3 |
Depreciation and other | 118 | 102.9 |
Selling, general and administrative | 21.5 | 21.3 |
Provision for losses on receivables | 21.7 | 25 |
Costs and Expenses, Total | 218.3 | 240.5 |
Income Before Income Taxes | 28.1 | 15.3 |
Consolidated Balance Sheets
Consolidated Balance Sheets (USD $) | |||||||||||||||||||
In Millions | Mar. 31, 2010
| Dec. 31, 2009
| |||||||||||||||||
ASSETS | |||||||||||||||||||
Cash and cash equivalents | 1854.7 | $1,912 | |||||||||||||||||
Assets, Total | 13,990 | 14,569 | [1] | ||||||||||||||||
STOCKHOLDERS' EQUITY | |||||||||||||||||||
Preferred stock, no par value: Authorized 1.0 million shares, none issued | |||||||||||||||||||
Common stock, $1 par value: Authorized 1.2 billion shares, 364.7 million shares issued | 364.7 | 364.4 | [1] | ||||||||||||||||
Additional paid-in capital | 87.4 | 80 | [1] | ||||||||||||||||
Treasury stock - at cost - .41 million shares | -17.4 | -17.4 | [1] | ||||||||||||||||
Retained earnings | 4,676 | 4640.5 | [1] | ||||||||||||||||
Accumulated other comprehensive (loss) income | -18.1 | 36.2 | [1] | ||||||||||||||||
Total Stockholders' Equity | 5092.6 | 5103.7 | [1] | ||||||||||||||||
Liabilities and Stockholders' Equity, Total | 13,990 | 14,569 | [1] | ||||||||||||||||
TRUCK AND OTHER: | |||||||||||||||||||
ASSETS | |||||||||||||||||||
Cash and cash equivalents | 1805.6 | 1836.5 | [1] | ||||||||||||||||
Trade and other receivables, net | 576.4 | 554.7 | [1] | ||||||||||||||||
Marketable debt securities | 246.7 | 219.5 | [1] | ||||||||||||||||
Inventories | 545.5 | 632.1 | [1] | ||||||||||||||||
Other current assets | 222.2 | 224.3 | [1] | ||||||||||||||||
Total Truck and Other Current Assets | 3396.4 | 3467.1 | [1] | ||||||||||||||||
Equipment on operating leases, net | 485.7 | 503.8 | [1] | ||||||||||||||||
Property, plant and equipment, net | 1696.2 | 1757.7 | [1] | ||||||||||||||||
Other noncurrent assets | 369.2 | 409.1 | [1] | ||||||||||||||||
Assets, Total | 5947.5 | 6137.7 | [1] | ||||||||||||||||
Current Liabilities | |||||||||||||||||||
Accounts payable, accrued expenses, and other | 1425.9 | 1,490 | [1] | ||||||||||||||||
Total Truck and Other Current Liabilities | 1425.9 | 1,490 | [1] | ||||||||||||||||
Long-term debt | 173.1 | 172.3 | [1] | ||||||||||||||||
Residual value guarantees and deferred revenues | 518.5 | 547.2 | [1] | ||||||||||||||||
Other liabilities | 357.7 | 405.3 | [1] | ||||||||||||||||
Total Liabilities | 2475.2 | 2614.8 | [1] | ||||||||||||||||
FINANCIAL SERVICES: | |||||||||||||||||||
ASSETS | |||||||||||||||||||
Cash and cash equivalents | 49.1 | 75.5 | [1] | ||||||||||||||||
Finance and other receivables, net | 6195.4 | 6497.7 | [1] | ||||||||||||||||
Equipment on operating leases, net | 1480.2 | 1513.2 | [1] | ||||||||||||||||
Other assets | 317.8 | 344.9 | [1] | ||||||||||||||||
Assets, Total | 8042.5 | 8431.3 | [1] | ||||||||||||||||
Current Liabilities | |||||||||||||||||||
Accounts payable, accrued expenses and other | 213.6 | 215.2 | [1] | ||||||||||||||||
Commercial paper and bank loans | 2675.7 | 3011.2 | [1] | ||||||||||||||||
Term notes | 2838.2 | 2889.3 | [1] | ||||||||||||||||
Deferred taxes and other liabilities | 694.7 | 734.8 | [1] | ||||||||||||||||
Total Liabilities | 6422.2 | 6850.5 | [1] | ||||||||||||||||
[1]The December 31, 2009 consolidated balance sheet has been derived from audited financial statements. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | |||||||||||||||||||
Mar. 31, 2010
| Dec. 31, 2009
| ||||||||||||||||||
Preferred stock, no par value | $0 | $0 | [1] | ||||||||||||||||
Preferred stock, authorized | 1,000,000 | 1,000,000 | [1] | ||||||||||||||||
Preferred stock, issued | 0 | 0 | [1] | ||||||||||||||||
Common stock, par value | $1 | $1 | [1] | ||||||||||||||||
Common stock, Authorized | 1,200,000,000 | 1,200,000,000 | [1] | ||||||||||||||||
Common stock, shares issued | 364,700,000 | 364,700,000 | [1] | ||||||||||||||||
Treasury stock, shares | 410,000 | 410,000 | [1] | ||||||||||||||||
[1]The December 31, 2009 consolidated balance sheet has been derived from audited financial statements. |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Cash Flows (USD $) | ||
In Millions | 3 Months Ended
Mar. 31, 2010 | 3 Months Ended
Mar. 31, 2009 |
OPERATING ACTIVITIES: | ||
Net income | 68.3 | 26.3 |
Depreciation and amortization: | ||
Property, plant and equipment | 48.1 | 49.5 |
Equipment on operating leases and other | 114 | 105.3 |
Provision for losses on financial services receivables | 21.7 | 25 |
Other | -18.9 | -28.3 |
Change in operating assets and liabilities: | ||
Wholesale receivables on new trucks | -0.5 | 205.2 |
Sales-type finance leases and dealer direct loans on new trucks | 57.3 | 44.1 |
Pension contributions | -19.3 | -153.2 |
Other | 14.7 | -183.1 |
Net Cash Provided by Operating Activities | 285.4 | 90.8 |
INVESTING ACTIVITIES: | ||
Retail loans and direct financing leases originated | (331) | -190.8 |
Collections on retail loans and direct financing leases | 534.6 | 561.7 |
Marketable securities purchases | -94.6 | -73.3 |
Marketable securities sales and maturities | 67.7 | 71.1 |
Acquisition of property, plant and equipment | -26.1 | -16.5 |
Acquisition of equipment for operating leases | (163) | -96.4 |
Proceeds from asset disposals | 44.3 | 91.4 |
Other | 8.6 | 4.9 |
Net Cash Provided by Investing Activities | 40.5 | 352.1 |
FINANCIAL ACTIVITIES: | ||
Cash dividends paid | -32.8 | -101.3 |
Stock compensation transactions | 3.6 | 7 |
Net decrease in commercial paper and short-term bank loans | -331.6 | -904.3 |
Proceeds from term debt | 13.2 | 942.8 |
Payment of term debt | -3.2 | -354.6 |
Net Cash Used in Financing Activities | -350.8 | -410.4 |
Effect of exchange rate changes on cash | -32.4 | -62.8 |
Net Decrease in Cash and Cash Equivalents | -57.3 | -30.3 |
Cash and cash equivalents at beginning of period | 1,912 | 1955.2 |
Cash and cash equivalents at end of period | 1854.7 | 1924.9 |
Basis of Presentation
Basis of Presentation | |
3 Months Ended
Mar. 31, 2010 | |
Basis of Presentation | NOTE A Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the first quarter ended March31, 2010, are not necessarily indicative of the results that may be expected forthe year ending December31, 2010. For further information, refer to the consolidated financial statements and footnotes included in the Companys Annual Report on Form 10-K for the year ended December31, 2009. Earnings per Share: Basic earnings per common share are computed by dividing earnings by the weighted average number of common shares outstanding, plus the effect of any participating securities. Diluted earnings per common share are computed assuming that all potentially dilutive securities are converted into common shares under the treasury stock method. The dilutive and antidilutive options are shown separately in the table below. Three Months Ended March31 2010 2009 Additional shares 1,050,900 922,900 Antidilutive options 1,846,400 4,030,700 Debt Issuance: In March 2010, the Companys U.S. finance subsidiary, PACCAR Financial Corp., issued $300.0 of floating rate medium-term notes which settled in early April. |
Investments in Marketable Secur
Investments in Marketable Securities | |
3 Months Ended
Mar. 31, 2010 | |
Investments in Marketable Securities | NOTE B Investments in Marketable Securities The cost of marketable debt securities is adjusted for amortization of premiums and accretion of discounts to maturity. Amortization, accretion, interest, dividend income and realized gains and losses are included in investment income. The cost of securities sold is based on the specific identification method. The Companys investments in marketable securities are classified as available-for-sale. These investments are stated at fair value with any unrealized gains or losses, net of tax, included as a component of accumulated other comprehensive (loss) income. The proceeds from sales of marketable securities for the three months ended March31, 2010 were $56.7. Gross realized gains were $.2 and $.1 for the three months ended March31, 2010 and 2009, respectively, with no realized losses. Marketable debt securities consisted of the following: At March31, 2010 AMORTIZED COST UNREALIZED GAINS UNREALIZED LOSSES FAIR VALUE U.S. tax-exempt securities $ 156.8 $ .9 $ 157.7 U.S. government securities 2.9 2.9 U.S. corporate securities 38.0 38.0 Non U.S. corporate securities 23.3 .1 23.4 Non U.S. government securities 11.7 11.7 Other debt securities 13.0 13.0 $ 245.7 $ 1.0 $ 246.7 At December31, 2009 AMORTIZED COST UNREALIZED GAINS UNREALIZED LOSSES FAIR VALUE U.S. government and agency securities $ 6.5 $ 6.5 U.S. tax-exempt securities 141.2 $ 1.3 142.5 U.S. corporate securities 22.0 .2 $ .1 22.1 Non U.S. corporate securities 22.0 22.0 Non U.S. government securities 12.2 12.2 Other debt securities 14.2 14.2 $ 218.1 $ 1.5 $ .1 $ 219.5 The fair value of marketable debt securities that have been in a unrealized loss position for 12 months or greater at March31, 2010 and December31, 2009 was nil and $27.4, respectively, and their unrealized losses on such securities were nil and $.1, respectively. Contractual maturities on these securities at March31, 2010, were as follows: Maturities: AMORTIZED COST FAIR VALUE 2010 $ 95.7 $ 95.9 2011 through 2015 144.6 145.4 After 2015 5.4 5.4 $ 245.7 $ 246.7 Marketable debt securities included $2.3 and $11.6 of variable rate demand obligations (VRDOs) atMarch 31, 2010 and December31, 2009, respectively. VRDOs are debt instruments with long-term scheduled maturities which have interest rates that reset periodically. |
Inventories
Inventories | |
3 Months Ended
Mar. 31, 2010 | |
Inventories | NOTE C Inventories Inventories are stated at the lower of cost or market. Cost of inventories in the United States is determined principally by the last in, first out (LIFO) method. Cost of all other inventories is determined principally by the first in, first out (FIFO) method. Inventories include the following: March31, 2010 December31, 2009 Finished products $ 321.4 $ 312.5 Work in process and raw materials 388.6 487.5 710.0 800.0 Less LIFO reserve (164.5 ) (167.9 ) $ 545.5 $ 632.1 Under the LIFO method of accounting (used for approximately 50% of March31, 2010 inventories), anactual valuation can be made only at the end of each year based on year-end inventory levels andcosts. Accordingly, interim valuations are based on managements estimates of those year-end amounts. |
Finance Receivables
Finance Receivables | |
3 Months Ended
Mar. 31, 2010 | |
Finance Receivables | NOTE D Finance Receivables Loans represent fixed- or floating-rate loans to customers collateralized by the vehicles purchased. Retail direct financing and sales-type finance leases are contracts leasing equipment to retail customers and dealers, respectively. These leases are reported as the sum of minimum lease payments receivable and estimated residual value of the property subject to the contracts, reduced by unearned interest on finance leases which is shown separately. Dealer wholesale financing represents floating-rate wholesale loans to PACCAR dealers for new and used trucks. The loans are collateralized by the trucks being financed. Interest and other receivables are interest due on loans and leases and other amounts due in the normal course of business. The allowance for losses for loans, leases and other are evaluated together as a group since they relate to a similar customer base and their contractual terms require regular payment of principal and interest primarily over 36 to 60 months and are secured by the same type of collateral. The allowance for credit losses consists of both a specific reserve and a general reserve. Finance and other receivables include the following: March31, 2010 December31, 2009 Loans $ 2,712.9 $ 2,875.2 Retail direct financing leases 2,128.9 2,260.0 Sales-type finance leases 720.1 764.9 Dealer wholesale financing 983.5 1,015.2 Interest and other receivables 140.6 109.6 Unearned interest: Finance leases (329.4 ) (359.6 ) 6,356.6 6,665.3 Less allowance for losses: Loans, leases and other (151.5 ) (157.1 ) Dealer wholesale financing (9.7 ) (10.5 ) $ 6,195.4 $ 6,497.7 |
Product Support Liabilities
Product Support Liabilities | |
3 Months Ended
Mar. 31, 2010 | |
Product Support Liabilities | NOTE E Product Support Liabilities Product support liabilities include reserves related to product warranties and optional extended warranties andrepair and maintenance (RM) contracts. The Company generally offers one-year warranties covering most of its vehicles and related aftermarket parts. Specific terms and conditions vary depending on theproduct and the country of sale. Optional extended warranty and RM contracts can be purchased for periods which generally range up to five years. Warranty expenses and reserves are estimated and recorded at the time products or contracts are sold based on historical data regarding the source, frequency and cost of claims, net of any recoveries. PACCAR periodically assesses the adequacy of its recorded liabilities and adjusts them asappropriate toreflect actual experience. Changes in warranty and RM reserves are summarized as follows: 2010 2009 Beginning balance, January1 $ 386.4 $ 450.4 Cost accruals and revenue deferrals 43.5 62.3 Payments and revenue recognized (54.2 ) (89.2 ) Currency translation (16.5 ) (17.7 ) Ending balance, March31 $ 359.2 $ 405.8 |
Stockholders' Equity
Stockholders' Equity | |
3 Months Ended
Mar. 31, 2010 | |
Stockholders' Equity | NOTE F Stockholders Equity Comprehensive Income The components of comprehensive income (loss), net of any related tax, were as follows: Three Months Ended March31 2010 2009 Net Income $ 68.3 $ 26.3 Other comprehensive income (loss): Currency translation losses (70.2 ) (100.3 ) Derivative contracts increases 9.4 9.7 Marketable securities (decrease) increase (.2 ) .4 Employee benefit plans amortization 6.7 4.0 Net other comprehensive loss (54.3 ) (86.2 ) Comprehensive Income (Loss) $ 14.0 $ (59.9 ) Accumulated Other Comprehensive (Loss) Income Accumulated other comprehensive (loss) income was comprised of the following: March31 2010 December31 2009 Currency translation adjustment $ 313.6 $ 383.8 Net unrealized loss on derivative contracts (39.0 ) (48.4 ) Net unrealized investment gains .7 .9 Employee benefit plans (293.4 ) (300.1 ) Total Accumulated Other Comprehensive (Loss) Income $ (18.1 ) $ 36.2 Stock Compensation Plans Stock-based compensation expense was $1.6 and $3.4 for the first three months of 2010 and 2009, respectively. Realized tax benefits related to the excess of deductible amounts over expense recognized amounted to $0.8 and $1.9 for the firstthree months of 2010 and 2009, respectively, and have been classified as a financing cash flow. During the first quarter of 2010, PACCAR granted 975,478 employee stock options at an exercise price of $36.12. The estimated aggregate fair value of the options granted was $11.95 per share. The Company issued 327,018 additional common shares under deferred and stock compensation arrangements in the three months ended March31, 2010. Other Capital Stock Changes No share repurchases were completed during the three months ended March31, 2010. |
Income Taxes
Income Taxes | |
3 Months Ended
Mar. 31, 2010 | |
Income Taxes | NOTE G Income Taxes The effective tax rate was 28.9% in the first quarter of 2010 compared to 28.1% for the first quarter of 2009. The first quarter 2010 tax provision includes a benefit of $11.3 from a favorable tax settlement which was offset by the effects of other assessments and a lower percentage benefit from permanent differences such as the RD tax credit and tax exempt income. |
Segment Information
Segment Information | |
3 Months Ended
Mar. 31, 2010 | |
Segment Information | NOTE H Segment Information PACCAR operates in two principal segments, Truck and Financial Services. Three Months Ended March31, 2010 2009 Net sales and revenues: Truck Total $ 2,056.3 $ 1,760.2 Less intersegment (90.6 ) (57.8 ) External customers 1,965.7 1,702.4 All other 18.6 28.0 1,984.3 1,730.4 Financial Services 246.4 255.8 $ 2,230.7 $ 1,986.2 Income (loss) before income taxes: Truck $ 66.6 $ 25.4 All other (3.2 ) (12.1 ) 63.4 13.3 Financial Services 28.1 15.3 Investment Income 4.5 8.0 $ 96.0 $ 36.6 Depreciation and amortization: Truck $ 71.4 $ 66.5 All other 2.3 2.3 73.7 68.8 Financial Services 88.4 86.0 $ 162.1 $ 154.8 Included in All other is PACCARs industrial winch manufacturing business and other sales, income and expense not attributable to a reportable segment, including a portion of corporate expense. |
Derivative Financial Instrument
Derivative Financial Instruments | |
3 Months Ended
Mar. 31, 2010 | |
Derivative Financial Instruments | NOTE I Derivative Financial Instruments Derivative financial instruments are used to hedge exposures to fluctuations in interest rates and foreign currency exchange rates. Certain derivative instruments designated as either cash flow hedges or fair value hedges are subject to hedge accounting. Derivative instruments that are not subject to hedge accounting are held as economic hedges. The Companys policies prohibit the use of derivatives for speculation or trading. At inception of each hedge relationship, the Company documents its risk management objectives, procedures and accounting treatment. Exposure limits and minimum credit ratings are used to minimize the risks of counterparty default. The Company had no material exposures to default at March31, 2010. Interest-Rate Contracts: The Company enters into various interest-rate contracts, including interest-rate swaps and cross currency interest-rate swaps. Interest-rate swaps involve the exchange of fixed for floating rate or floating for fixed rate interest payments based on the contractual notional amounts in a single currency. Cross currency interest-rate swaps involve the exchange of notional amounts and interest payments in different currencies. These contracts are used to manage exposures to fluctuations in interest rates and foreign currency exchange rates. Net amounts paid or received are reflected as adjustments to interest expense. At March31, 2010, the notional amount of the Companys interest-rate contracts was $3,160.0. Notional maturities for all interest-rate contracts are $1,066.4 for 2010, $1,145.7 for 2011, $743.2 for 2012, $34.6 for 2013 and $144.3 for 2014 and $25.8 for 2015. The majority of these contracts are floating to fixed swaps that effectively convert an equivalent amount of commercial paper and other variable rate debt to fixed rates. Foreign-Exchange Contracts: The Company enters into foreign-exchange contracts to hedge certain anticipated transactions and assets and liabilities denominated in foreign currencies, particularly the Canadian dollar, the euro, the British pound, the Australian dollar and the Mexican peso. At March31, 2010, the notional amount of the outstanding foreign-exchange contracts was $170.8. Foreign-exchange contracts mature within one year. The following table presents the balance sheet locations and fair value of derivative financial instruments: March31, 2010 December31, 2009 Assets Liabilities Assets Liabilities Derivatives designated under hedge accounting: Interest-rate contracts: Financial Services: Other assets $ 10.1 $ 10.8 Deferred taxes and other liabilities $ 101.3 $ 107.1 Foreign-exchange contracts: Truck and Other: Deferred taxes and other current assets .1 .1 Accounts payable, accrued expenses and other .1 .2 Total $ 10.2 $ 101.4 $ 10.9 $ 107.3 Economic hedges: Interest-rate contracts: |
Fair Value Measurements
Fair Value Measurements | |
3 Months Ended
Mar. 31, 2010 | |
Fair Value Measurements | NOTE J Fair Value Measurements Fair value represents the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The hierarchy of fair value measurements is described below. Level 1 Valuations are based on quoted prices that the Company has the ability to obtain in actively traded markets for identical assets or liabilities. Since valuations are based on quoted prices that are readily and regularly available in an active market or exchange traded market, valuation of these instruments does not require a significant degree of judgment. Level 2 Valuations are based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market. Level 3 Valuations are based on model-based techniques for which some or all of the assumptions are obtained from indirect market information that is significant to the overall fair value measurement and which require a significant degree of management judgment. The Company has no financial instruments requiring Level 3 valuation. The Company uses the following methods and assumptions to measure fair value for assets and liabilities subject to recurring fair value measurements. Marketable Securities: The Companys marketable debt securities consist of municipal bonds, government obligations, investment-grade corporate obligations, commercial paper, asset-backed securities and term deposits. The fair value of government obligations is based on quoted prices in active markets. These are categorized as Level 1. The fair value of municipal bonds, corporate bonds, asset-backed securities, commercial paper and term deposits is estimated using an industry standard valuation model, which is based on the income approach. The significant inputs into the valuation model include quoted interest rates, yield curves, credit rating of the security, and other observable market information. These are categorized as Level 2. Derivative Financial Instruments: The Companys derivative contracts consist of interest-rate swaps, cross currency swaps and foreign currency exchange contracts. These derivative contracts are over the counter and their fair value is determined using industry standard valuation models, which are based on the income approach. The significant inputs into the valuation models include market inputs such as interest rates, yield curves, currency exchange rates, credit default swap spreads, and forward spot rates. These contracts are categorized as Level 2. PACCARs financial assets and liabilities subject to recurring fair value measurements are either Level 1 or Level 2 as follows: At March31, 2010 LEVEL1 LEVEL2 TOTAL Assets: Marketable debt securities U.S. government and agency securities $ 2.9 $ 2.9 U.S. tax-exempt securities $ 157.7 157.7 U.S. corporate securities 38.0 38.0 Non U.S. corporate securi |
Employee Benefit Plans
Employee Benefit Plans | |
3 Months Ended
Mar. 31, 2010 | |
Employee Benefit Plans | NOTE K Employee Benefit Plans PACCAR has several defined benefit pension plans, which cover a majority of its employees. The following information details the components of net pension expense for the Companys defined benefit plans: Three Months Ended March31, 2010 2009 Service cost $ 9.4 $ 10.1 Interest on projected benefit obligation 19.1 18.0 Expected return on assets (24.2 ) (21.5 ) Amortization of prior service costs .5 .5 Recognized actuarial loss 3.6 3.0 Net pension expense $ 8.4 $ 10.1 During the first three months of 2010, the Company contributed $19.3 to its pension plans. |
Severance Costs
Severance Costs | |
3 Months Ended
Mar. 31, 2010 | |
Severance Costs | NOTE L Severance Costs During the first quarter of 2010, the Company did not incur any severance expense and did not have any amounts accrued for future severance payments at March31, 2010. During the first quarter 2009, the Company incurred severance costs of $9.7 in the truck segment and $.1 in the financial services segment. The costs incurred in 2009 were the result of work force adjustments reflecting low truck demand, primarily in Europe. |