PCAR - Earnings call transcript Q4 2024

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Operator

Good morning, and welcome to PACCAR's Fourth Quarter 2024 Earnings Conference Call. [Operator Instructions] Today's call is being recorded. And if anyone has any objection, they should disconnect at this time. I'd now like to introduce Mr. Ken Hastings, PACCAR's Director of Investor Relations. Mr. ahead. go please Hastings,

Ken Hastings

Preston welcome Poplawski, My by PACCAR's name And Financial morning Investor to Schippers, Officer; on and President President Director and and the Relations. Chief are this me webcast. is and joining Chief those like Executive phone Harry Brice listening Officer; those of Feight, Vice We'd Ken Hastings, Controller.

will we participate be of the information the line in As and listen-only may members presented and uncertainties with media affect forward-looking any today prior involve risks expected ask that conference Certain a calls, mode. that on results.

information, our paccar.com. please For at additional of the see the and Investor Relations page filings Relations Investor SEC

now would to Feight. I introduce like Preston

R. Feight

of annual year everyone. I our as Ken XXXX, and higher well on revenues latest net trucks products, was a PACCAR revenues achieved and $X.X share. year PACCAR's and invested world-class in $X.X yield performance quarter return XXXX. and our highest This new Harry, income is a outstanding technologies. declared division income customers on the In other dividend in the is record will This $XXX paid business morning, history, a income another year XX solutions the highlights. and our it of the In DAF and every delivered dividends, with Brice, and shareholders providing an has consecutive results and achieved results by XX state-of-the-art XXXX XX.X%. transportation of a profit past strong the of per results and the was strong in $X PACCAR's XXXX, income as years you billion, billion share fourth second revenues X%. and Peterbilt PACCAR PACCAR. dividend and over Financial billion a of Parts were reflects great payout of the million. of profitability and XX% years after-tax Good PACCAR's net year-end company's year quality full for $X.X highest of employees good Trucks, of customers update dividend net for including benefited $XX.X fourth in net facilities per quarter from the $X.XX generation in since PACCAR Services. PACCAR industry. financial billion, PACCAR's Kenworth,

year. and PACCAR excellent of to $XXX billion and Parts increased and revenues Last were Class Kenworth XX.X%, share units. $X.X million. created sales and prior year's medium-duty pretax achieved medium-duty of as Peterbilt's and truck truck X Peterbilt's a to Kenworth quarter XX% trucks. medium-duty produce fourth grew market Canadian new retail from U.S. XXX,XXX strong a profits the in the In XX.X% XX.X% market, they from XX,XXX excellent has up customer record value, share

by U.S. anticipate truck to steady. the range above fuel to DAF's year. efficiency market The more is improvement. while of to expand the where The segment signs market and is In other Kenworth projected sector less-than-truckload X%. Truckload is beginning well, show economy vocational and The XXXX, Peterbilt U.S. than a leaders is performing is we registrations Canadian XXX,XXX appreciate Class the be were year. XXX,XXX last market X We vehicles. industry-leading as in and European strengthening comfort. market to a truck forecast XXX,XXX through progress driver Customers truck of XX-tonne

the to the In DAF largest innovative, an modestly. economy design interior. is advantage grow to XXXX, the and market trucks a competitive cabin due most have European European luxurious in forecast aerodynamic feature and

trucks increase in be DAF's Last in to similar XX%, right a We and XX% Brazilian XXX,XXX share the reflects this range market XX-tonne expect registrations. is XXXX. of the to truck market XXX,XXX American around production be expected and market above to year. more above XX-tonne South vehicles the than XX,XXX market was year, important in was the XXX,XXX to

and These its to cycles, the America. growing margins Andean the DAF the as trucks Truck, business successful of Peterbilt as in region of and Parts the trucks solid Mexico value sold are gross Parts. South Brazil, PACCAR in in addition now of industry In in to Other are in PACCAR were well provide DAF reflecting quarter. higher continued Kenworth new prior than increased margins fourth customers and considerably growth the XX.X%

first and margins XX,XXX. fourth trucks. quarter quarter, be And the PACCAR and We similar to be first forecast to of around a estimate to In of Truck XX%. XXXX, fourth PACCAR's delivered quarter XX.X% to Parts XX,XXX gross in are deliveries worldwide the in range the quarter

other joint the year venture performance, of the Chillicothe, Environment provide strong excellent PACCAR's Award founding Parts U.K. Truck an vehicle XXth other Leader highlights. Peterbilt Cell honored XXXX look financial manufacture celebrate anniversary batteries commercial truck included and progress and Ohio. XXXX In of Schippers on was TRP. United on the Harry? update XXXth of Kenworth in anniversary to DAF Amplify Energy an we for to the addition Sustainability Fleet States. the to PACCAR world-class Parts, in business PACCAR's forward and, earned Harrie business highlights Year Services XXXX. now the as will Financial factory celebrated PACCAR in the of as anniversary in our We celebrated the a in Technologies, in its XXth PACCAR

Harrie Schippers

times well strategy million. to market parts a pretax of of truck is Parts profits. performing XX.X%. profit investments market November. low a distribution XXXX, convenience parts reflects customers. current credit DAF's makes quality to truck the provides through portfolio strong was parts the servicing use margins processes. technology we dues. income Financial market pretax In freight of that aftermarket in which X% in customers the $XXX business Parts' PACCAR averaged to PACCAR PACCAR past the credit largest income of Financial is excellent quality PACCAR's revenues Services by Annual the the to for service PACCAR for parts PDC and quarter in set the a with billion, grow profitability achieved phases increase vehicle This with environment, that has Parts or easy a all increased Europe. PACCAR gross $X.X to records highest application the billion. to Part has increased delivery new fourth $X.XX Germany, business for sales through and estimate record $XXX to revenues and and them Financial increase cycle. including X% and record it in dealers share uptime opened million. part provides availability and this PDCs growth business a to by XX in of PDC worldwide, loan and benefits and excellent year. expanded long-term do centers and Thank you, customers In enhances Annual efficient German PACCAR new Preston. pretax X% in

innovation PACCAR centers and development. we in $XXX the and excellent million new we is are to in return million invested capital in adding center XX.X%. Financial and million Warsaw, $XXX truck expenses range research $XXX capital PACCAR trucks, PACCAR around a sale operates used invest the delivered truck the $XXX Premium, to investments million to and on of of planning and this in world projects. of as used an in of year, DAF million capital $XXX projects key R&D range year. technology the million in support used This year, Kenworth, $XXX Last Poland and XX Peterbilt invested

enhancing customers' as support alternative battery PACCAR's These to significant their and our and businesses, powertrains, connected growth expanding success. future generation services. PACCAR's diesel clean new and systems driver consistently North and fuel advanced well at contribution electric Peterbilt PACCAR manufacturing Kenworth, Brazil engines, vehicle factories network investments success. in assistance include the as will making industry-leading Australia. is Europe, capacity of PACCAR's dealers our next integrated long-term distribution and These DAF invest in a our America, independent

looking questions. be to excellent Thank PACCAR year in to forward you. XXXX. is your another answer pleased We'd

Operator

Zakaria [Operator of comes first JPMorgan. Instructions] question Our Tami from

Tami Zakaria

could guide. my to understand that Can question the delivery the you if deliveries highlight? by and first bridge from gap help which coming the is us quarter, quarter So fourth the think about geography, trying difference you geography to versus in where how is on

R. Feight

talk a Good is bit you QX. just has normalizing is in been be which But Tami. robust What medium-duty very to the to seen share we've you. what Happy, would U.S., the I probably little Class to X market, in flat even Yes. up we expect now. is with or

was So there X we'll was in people see us in a that Mexico remind a bit smaller that Euro medium-duty I'd market. quarter. fourth also implementation the

there if you're reduction the So was won't first was fourth bit comparisons year-end that Mexico kind supplier had of our normal QX, of be in quarter also, good in quarter. And pre-buy that that we in place. QX, a allowed inventory present take that performance doing a their of

production fewer And maybe one South things an specifically we America those last all have U.S., days is of kind So I'd the outside an as impact. impact. in add only the had

delivery up that we're guidance. into in seeing slightly flat in U.S. markets. Class goes X that the But Class essence, all X, So maybe

Tami Zakaria

Got That BEVs. JV away at very could current you be is the that question Cummins the Amplify. my this have helpful color. point given whole idea second The is you shift you think And for Daimler. on could and revisit investments Do administration from it. with the -- rethought

R. Feight

have our so We be batteries I'd we'll Cell Well, customers to will us quality support see I venture strategic decision. most to full a decision And battery there in that market, customers. a I now choices. for company long-term if portfolio you. make powertrain sense with think vehicles in lowest what same our will that's I with be be remake our or am that able our the make the will this hybrid could And could of to which know, Technologies joint happy where I I'll vehicles. knowing how places competitive cost, the the electric offer be share Amplify of allow so highest It's going. be the objective

Operator

Our Kyle question Citi. next Menges from comes of

Kyle Menges

I pipelines? of seen vocational maybe order been could customer's give name you in gauge reference strength, confidence that piece in a Class aren't you why guess And you So resilience like seems those it of actually many big orders the dealers But we've of builders us gives a what to a have and here just, stay X. attached. this did just overordering body that's how

R. Feight

Yes. Yes.

of We solid. have -- feel all customers there really our

way if it you at fact, is look inventory. one to -- In

is inventory levels heavy-duty X.X months. industry and Kenworth X.X months the So Peterbilt's and inventory what, at in running,

There those shape. but backlog in is really our is good at So are trucks. builders, body spoken a for inventory

Kyle Menges

then you you're And on U.S. through in the a medium-duty maybe more provide as progress we the Canada thinking market and could about if little color how Okay. just year.

half how You as the mentioned guess year, half throughout we you just about are helpful. move second bit little a first thinking I in XQ, would probably but versus the down growth be

R. Feight

Yes.

year. the back, kind builds. what a in had last referencing that if mirror saw There you'd third recall, pretty There strong year, a Kyle, of in fire were of the we you steady deliveries some was, think that set we that to say factory quarter. I builds amplified

to deliveries to to you're products that levels, XQ, our market to think lower we'll now when in go And perform historically normal, continue XQ normal And just well. at normal XQ. we So is levels. see comparing back going the you'd those medium-duty new more see

happy work new Customers well, with share. they're body Kenworth builders, seem They the Peterbilts. wide and market quite X.X-meter our gaining

we've XX.X% XX% last in grown In market share year. fact, from the to medium-duty

to we about would second cadence of X see half. position. the expect feel strengthening half to in it So also The X good probably our half

Operator

from Jefferies. comes question next Our of Volkmann Stephen

Stephen Volkmann

what's of it we seems a look in at we've bigger I revenues X%-ish, was in truck provide math And mostly down and But any like or and there do per that. kind which think one you price and I'm declines like curious ] happening Or mix? revenue the of mix how do there lot vocational? color, is deliveries, of [ we seen on that of recently. kind mix? things about kind of by can sort divided curious, the more I'm was total the cab between price there's more as the Is dumb if know day truck going

Harrie Schippers

of regional going mix Steve, -- mix a Yes, on. little there's bit

top foreign in QX. more That's unfavorable little or exchange stronger is then mix the in that, on in rates. vacation America had we of And North Europe bit quarter. fourth holidays So a

very the that in reduction And average a it's half So strong probably accounts sales dollar. price. for of

Stephen Volkmann

Got it.

Okay. Right. A lot in there.

you the increase expected guys looking regulations telling to? have forward Okay. kind customers then for all the the differently, slightly order of of started your of or XXXX that price magnitude announced we're And

R. Feight

$XX,XXX having price about that, now. saying can finalized, adjustments We're to details we're what of kind $XX,XXX, be like still and them but that conversations for with aren't that's Obviously, the it the general it feels range of right XXXX.

Operator

Melius of from Wertheimer Research. Our Rob next question comes

Robert Wertheimer

two, I had I may. if

thoughts that your least like you inventory probably hear whether down. my curious I'd the at to on gross reverse you see pricing. love just market truck come know [indiscernible] is you First new seems if truck on just on have. data That's or better It first hopefulness margin any to that I don't one. trend pricing? stabilize, and And and used see

R. Feight

say like we margin. seeing that Yes. is tell looking things where you gross as pretty said steady, should QX we're be to XX% what we'd Rob, Sure. guide, and our XX.X% into from can

that we things So starting as the gaining the the into up of through probably beginning see but look course are truckload then come the carriers noticed strength to to, to we market starting just and back year.

Harrie Schippers

at add Financials very the Rob, and I And that now. inventory is right used healthy truck side, levels would truck on then low PACCAR used

And so that's thing. also a good

R. Feight

. well. as indicator leading good a That's

Robert Wertheimer

there. bottom The

what that I'll And stop my maybe bit of customers. there full and electric. there. across use thoughts the Preston, Perfect. I'm they from go resistance you'd hybrids that just I'm cases feeling are world, I that trucks. there. actual nonregulatory? something to for just hearing the curious Okay. now? a there's then your even really think years about truck hybrid demand curious curiosity, ago, that your you auto, mentioned the was Is Or And spark

R. Feight

Rob. Yes. Great question,

it. gas do cost we what if we desirable our think an that, improve There likewise, to fuel hybrid and that might I that's by able we're see greenhouse for through is to efficiency able And customers. is levels. double-digit systems, obviously to added be

into So time the sits the payback balance there. of what's

a is time. free that which we business know will and regulatory coming for So regulations case, of be a but striving is hurdles, going there there over

also And Europe, be hybrid that and could business that's to maybe true in So an incentive U.S. added case. Europe. for true especially both

Operator

question comes next Our UBS. Fisher Steven from of

Steven Fisher

I in the just upon quarter. the wanted to first margins touch

Preston, in on light I'm which said, what be guess of they're lower pretty production. that enabling just level lower margins of impressive XX% you production? stable, curious that steadiness pretty is to As going of I is the

R. Feight

Well, the I seeing is trucks well. are what really, think we're really performing

with is us, helpful great. customers. discussions Fuel great. to that's So obviously, of is terms in The reliability economy

Our feels slightly kind is the factors where just that think down. starting are in like we'll appear we to all warranty a it those the of market head, and costs between that first And quarter. margin see

Steven Fisher

kind be downturn? Do this part more that we've you pricing I guess, think stable discounts environment curious pricing we're we about can And for that Okay. it's just now sort confident that the how broader in low hit now. of the the point And of and year? of the on margins

R. Feight

I continue And second the think again. what year. half, we've the of a the how second question in the see quarter, and world for course, is sure Great maybe shared but XXXX with develops, like to throughout improvement coming Sure. feels watch share think to we'll we we We in it's trend. have positive it like

Operator

of Castillo comes Our Morgan Angel Stanley. from next question

Instructions] Angel, lot we your line. feedback are [Operator receiving from a of

R. Feight

let's to Charlie next Why yes, the go caller, don't we the caller. to go next

Operator

comes question from Truist Jamie Cook Securities. of next Our

Jamie Cook

do year, that of the And if company? was price that by position back wondering sounds the where second to and margins Or in parts XXXX? truck margins decremental. question, specifically get see sales actually back and total. half first incremental quarter for specifically I'm region the then the then what's in to a get for you Just the also fourth clarify, And what is can you Is just and is implied you trough you for for my cost versus like we're to say would growth margins? for seeing speak truck it to quarter total expect for

R. Feight

through way truck negative But was already price cost is And the and the QX think, of I cost was price some Jamie. asking see quite on of mean to talked versus bit. about, that's improvement what for course a I another expecting X.X%. what X.X% we Yes. year, we're the trending

so XQ, we so first like think XX.X% in and continued be as margins parts margins, the will well. in would continued to good that quarter favorable we And expect to point, we strong your and see see

to are in trend a general our those mind. So contributing upward

Jamie Cook

question my geography, But by guess was that was. I

Harrie Schippers

provide geography, by we think don't I Jamie. it

Jamie Cook

I are first we margins? of your then see And was the start to Are margins second assuming half impressive sales question now are right versus decrementals? up pretty incremental quarter. the Okay. should guess in mean I volumes XXXX, follow-up you by the

Harrie Schippers

the half improves expect market the As accordingly. in second we the of improve would year, development to margin

R. Feight

time cycle-over-cycle, margins Yes. I margin nice points. on And comment it is remain will thanks be as we that the we XXXX mean, are for as year. said the see also -- I we think because comment throughout that good a these that do think, Jamie, hundred few the on for improvement This think consistent. will incrementals. time, improvements, our -- last good we've it basis improves, And

Operator

of question Our Tim comes James. Raymond next Thein from

Timothy Thein

just provide Maybe activity pertains any America is and it comments Europe. could in just question, how of in first North terms you just filling as the both and to backlog order

presumably Just your terms extend far and times lead that. second on how you quoting color that the maybe how some give in just but quarter, could into of curious,

R. Feight

to Good question, for insight Tim. gain Sure, everybody. good

think half that QX. roughly probably I like in and full or more we're XX% QX full XX% in

look kind where reasonable like, that's So pretty things of levels.

Timothy Thein

it. Got

if the standpoint? again, presumably And a vocational. -- any about I mix impact, should a assume, the there? correct, we of heavier from composition dynamic from that weighting would much And that than Or weighted, would there Is a think that much that impact mix kind towards be supposition more that? is of Just normal? neutral is product backlog, Okay. of an

R. Feight

kind think I vocational think of I of as to year -- last is more the vocational vocational a levels. coming back that more And the the traditional mix was now, influence of heavy Tim, shift steady thing.

Timothy Thein

Okay.

but today's we -- to maybe a in at quarter? had it. that the just first that for levels of on some may dollar f, Okay. if, Is a about, pretty the through there the big margins levels think today's the some key then had Harry, what at moves exchange fourth had against foreign And quarter, FX imply big your way a, impact currencies. for and if the what were Got dollar what quarter

Brice Poplawski

our currencies what's on that's don't Yes. the are, effect obviously, negative said, effect. know We had there just it And -- But to million. stay you the net a be recurring rates. happen is will comment from in $XX as I'll foreign a they we on income if where fourth Brice. of obviously, something going about quarter This we would that. to

Harrie Schippers

factored all XX%. into it's And of our XX.X% to guidance between

Operator

Our will Castillo go Morgan question next of Angel to Stanley.

Angel Castillo Malpica

Yes, can you me hear this at time?

R. Feight

giving Yes, not time. static us quite first your on the you did you're

Angel Castillo Malpica

I it now. It for sounds apologize working like right that. is

initial So I about to continue just be kind of of expense just will fair you what's full moving you should that it forward? a is apologize lowered going to the driving year. in project. questions around maybe and Is three -- if was Can And be in will it it, that, it you to doing the of phases back lot all reasons I somebody think to assume good, the invest forward? I a we Obviously, it JV. Or for but one talk it are asked Amplify the phases multiphase -- R&D but that? believe strategic maybe to I that assume move deciding guess,

R. Feight

of a sure. them. great question, both Yes, It's

year-over-year, is up. slightly to we're still thinking be R&D So going

lot range great X% of for So probably be of working there's because projects from up us just on. last the to a in year

we've much space. Of what is that. started in putting on But buildings. Amplify One install. how we is we're then doesn't with the doing to we'll to the ground need And capacity We're we into want get Amplify what fit course, that the really measure now. do cleared But

available So hybrids.. or And we'll market markets have for for the just the demands then scale some that upon we capacity capacity based exist. EVs

Angel Castillo Malpica

shoots of this That's TL improvements. well last some helpful. I some quarter to maybe green made guess wanted And the then go see to on back I starting to are quarter in comments some you've as terms and

little confidence in terms as think I some market? improvement give are a TL you XQ Can customers see second half? of you you the more green number you in color just mentioned potential maybe XQ. that to exactly see you bit -- as more you rebound starting your would from maybe shoots that kind maybe show what you of of on hearing soon maybe a could a us versus could give And what

R. Feight

A we've improvement. is, to rates couple started just of spot things. One see

So that's the into that's say of the capacity market. some of something measuring has I'd thoughts. out our come

So inventories carriers the for also it become would used the earlier, add, said are then to quite easier that low. I as successful. we And market it's making good

a bit. And little so of the is how that's to tell kind a starting of world turn

indicators of all those is to come. we what soft So think of are

Operator

comes question next Our Evercore of Instructions] Raso [Operator from David ISI.

David Raso

strengthening is bit, little reaction of that year the influencing 'XX recent that dovetails influences with how executive then that Your just shipping White April? to the I model you And in of orders maybe think market to start pricing you're you prebuy, how your pricing? about how about how a comment the wrapping about a as assume that think years into the House progresses, how about think from sort which bit the some

R. Feight

ready they then at were we'd what be to Well, we attention If and rules. it, to that, we we know are too. but the are change, those ready the rules orders, for look we pay today, for executive

is of California. implemented suite one to has things has in of technologies The a the develop do PACCAR already NOx we've able NOx low engine think the we need. California I been and engines

to be we'll position I can available we So And think as in shift around, ready that. that be well.

question pricing you in XXXX product asked about shipments. To first the

strengthening price anticipate. people performance trucks, 'XX that carries of beyond as progresses, think year the on we right? We the are will as for around and moves I position ourselves think of the experiencing expect and great Peterbilt even market the course we Kenworth, that we see DAF trend the

David Raso

'XX start year? in there'll that 'XX And getting be we XQ and models shipping the this 'XXs I in start 'XXS April. year of But the know XQ. model a We little for accurate? shipping in some of hear is mix

R. Feight

Yes.

I know of resonate don't April is, Your what year there, model me us. that but doesn't that for a to 'XX shifting comment, in David,

to So I'm not answer that. sure how

David Raso

you're talk can sequentially higher model. referencing We on to name want pricing the goes what as year Okay. offline. is however But you the basically, the

R. Feight

fair. That's

Operator

of next Revich question Sachs. comes Goldman Our from Jerry

Jerry Revich

ask you the in the cadence terms first guidance quarter, couple about we're to a over truck next quarters. wanted in costs. that for margin seeing wondering Can sounds gross you the per decline expect like on of based about cetera. I the your quarters? based the next operating talk performance contract Can et of truck cost. It just you maybe talk per structures, the couple on I'm of the cadence on over

Harrie Schippers

cost at during more on added especially look in trucks, you the year. -- some where other If of we because legal in the we we and are ADAS Gary, connected, per Europe, features some truck, requirements, XXXX, saw content

We stable as to now. as year. tell developments far But expect less enter levels in or the cost right we no can those new more be I as XXXX, special specific

Jerry Revich

Okay.

planning the can move but appreciate on ruling separately, I topic EPA governments those case regulations playing is for if going scenario along we changes. the process? your in legal a of states would can forward, California scenario you rest have the and you In or that something and the of see there's scenario react an adverse to other in versus base talk about So -- out U.S., obviously, it's XX, how would the different if lines, that how make company

R. Feight

none. this be is, about ability the reactive to people our quality and things the and nimble company, of is great I that's think, the One PACCAR second of in to

I those changes there think regulations, there regulatory the adjusting better is So are at in people changes if to nobody at than PACCAR.

the products we are the regulatory customers front the right operating make to that for we'll the condition give going environment. them so And sure of have in best

Operator

next Our Partners. of Vertical Research from question Jeff Kauffman comes

Jeffrey Kauffman

Number about to questions. back two truck the Okay. change one, come revenue X.X. down I per was -- in want to

you difference price. of me I how you that is I'm most and an of assuming of math? think about to the was mix think that give the mentioned currency. idea Could rest

Harrie Schippers

the or Canada of said, less holidays. that fourth we is think half currency. the have more another is Like impact and more in quarter, element there I the And there U.S.

Europe sales outside So more average prices the -- other bit are little mix a and trucks sales U.S. lower. prices heavily markets was smaller average but and towards are the

Jeffrey Kauffman

but just I the David where do to as to follow rules think there of that would other is are discussed, its Raso's you Obviously, -- the new to And in terms on new rulings from up about have been risk administration? in comes you that question. be want administration that thinking worth out . Okay. EPA, with impact ignoring comply PACCAR 'XX the

R. Feight

don't as opportunities. I risk as much of think as them I them of think as

you any time then a intend think I where winning that's than position better if environments we competitors, change, find operate your you'll yourself be. and in to

Jeffrey Kauffman

opportunities some would in what your Preston, So mind? be of those

Harrie Schippers

to Brazil, things local-for-local, produce example. The for tariffs, the we protected factories us we that well for fact have where in Same very Mexico, like in Europe trucks makes U.S. produce the the U.S.

feel we're a we there. good spot in So really

Operator

from Bank of question comes of Our next Feniger America. Michael

Michael Feniger

because level pricing linear? look puts raising think Is see products, that your basis? go takes has to kind I'm guys Is because PACCAR that kind you more I'm Or there margin? guys trucks you curious trucks your gained market hold and as capacity? I that not Just every is gained how Is curious clearly we it's curious Just over to continue to share. kind have try share? much about of of is and just intensifies, multi-cycle to and of likely it the weigh other share, a OEMs of to capacity, of and how goal share price gain year, market your other so realize more raising you great trying your after of that to PACCAR that OEMs is for premium some a your lot there? if

R. Feight

the it produce about for trucks. trucks. those pay and can them is Yes. that for most to, gave The for share of in them, that we produce producing people and try that our good valuable make a trucks for fundamental our for That's the we trucks in and our PACCAR us, a trucks first if great that job our great the then And showing to us better we it that do they're that really you customers The value out [ great way outstanding more and off, the going ] share customers. to benefits willing thing. we them, nod are we equation. also and think dealers are sure our do works of supporting there customers I'd to

maintain our to us about share. achieve to gain us our it's market simultaneously great position allows So benefits customer. also That helps really trucks that premium and

Michael Feniger

last your And on revenue is Great. quarters, just X%. three parts. up The

think profit Just I has does there the down we flag sales last turn page, kind profit -- be you just of the curious 'XX? been year-over-year. profit the parts the we -- does on I'm line to slightly in with of helpful. of Is on would grow at that as want pieces would any anything as XXXX? look kind kind pretax moving there pretax

Harrie Schippers

X% In XXXX, for for increased by down parts the we see X%. market sales the saw was part time, that or same sales we At auto X%.

to to we by PACCAR excellent parts really X% team. our in X% margins, the a go that's Parts smaller we at the And year. growing entire sales XXXX, as a expect parts So for grow into by market impressive performance

parts. So that for PACCAR another be strong year will

Operator

Our Instructions] Research. from comes Wolfe Group [Operator Scott next question of

Scott Group

actually to want last on that question. just I follow up

are the market but and think slows. parts you So I growth And year, up year, guess think this sales the flat last is you up, parts to the markets if X%. about down

market seeing is we're a understand part sales me the help in improving. pickup So why not if

R. Feight

the last one Harrie Well, for market, halves, total to things cadence like market. the going parts the of market probably X a tale indicated, like year it's the the of be is of general and is

So would expect talking what in the right QX, performance now and see about we the growth course parts is through and excellent of we're QX to then year.

Harrie Schippers

It's to strongly on the business. the related rest activity freight of

So kind of it that cadence. should have also

Scott Group

Okay. first think I for That second makes XX% sold the full said quarter, sense. half then And the for quarter. you

yet? you Or late, is all of any do context behind still sort have prebuy any of of strength [indiscernible]? that order started about that right, activity the you do Just then ahead And schedule? schedule, of has that is have view of sort does

R. Feight

of then in of position the what Yes. say really But We're the backlogs, and to in that are a any been significant 'XX are really for I order do that of the And cycle. normal around would happening. for for in kind there's going area. say second of kind fairly I 'XX half wouldn't people our part discussions intake this normal

Operator

Our next Liss Kepler question comes from Max Cheuvreux. of

Unknown Analyst

a European the had market. about just question I

flavor If 'XX. about there, market also progress but the some and see mean please? you there could you guidance, countries give how around the could have you if different some give I you flavor

R. Feight

sure. Yes,

the sense really Germany. start Harrie that I is growth, Let would some I we it. I year of European say. thoughts last think to in us is markets add is slight then European mean me the for going were potentially geopolitics, experience slight and Central to Eastern general and saw -- maybe economy can the What softer Eastern because

of this leads what And year. has some the Europe that to that So that. the continues think, about kind in see people market. add through moderately that don't if feeling I okay to, Harrie, would you impact I know on We'll overall. market

Harrie Schippers

XX% year down in down Central markets Europe, Europe last X%. Eastern was but And then maybe about range. Overall, and we Europe in the Western talk X%,

like Lithuania presence countries impacted. has more especially So DAF a Poland, strong there. And are

bigger our the that's has DAF the which it some into a competitors. So maybe we on good that market But XXXX, looking on it should of market in a little do well. PACCAR bit guided, than range and impact really has

Unknown Analyst

regarding just could comment you add in DAF. capacity a Europe there with your And Okay. Great. utilization

Harrie Schippers

is utilization Capacity good.

R. Feight

when We have capacity grows. market the for

make the to continue smart factories there. investments We in

our in the factory the We U.K. in Netherlands. factory have

so can produce to. the we And trucks we need

factories and make more We efficient. to more those continue

Unknown Analyst

is the there and And that average first second quarter for the the same as you or about -- group. coverage the the for back mentioned whole

Harrie Schippers

Yes, Europe more less Preston that's correct. just in the in line group. is what with total or mentioned

Operator

this We questions the in further have no at time. queue

management So back I'll team any or remarks. further over final to hand the for

Stephen Volkmann

joining and I'd call, like you, to thank the everyone thank Charlie. for

Operator

Thank joining. call. today's gentlemen, and you this concludes for Ladies

now may disconnect lines. your You

PACCAR (PCAR) 28 Jan 252024 Q4 Earnings call transcript