With a view to improving its product lines, PACCAR Inc. (PCAR - Analyst Report) has launched high technology aerodynamic trucks at the Mid-America Trucking Show in Louisville, Kentucky. It took nearly 4 years and $400 million to launch these trucks under the Kenworth T680 and Peterbilt 579 brand names.
The trucks, powered with the company’s own fuel efficient and high horse-power diesel engines, have a cab width of 2.1 meter. These trucks form part of the heavy-duty class-8 segment and are available at low price.
In the fourth quarter of 2011, PACCAR achieved a record Class 8 retail market share of 28.1% in the U.S. and Canada. Class 8 industry retail sales in the U.S. and Canada improved 56% to 197,000 units in 2011 from 126,000 in 2010.
The company reported earnings of 91 cents per share in the quarter, up from 46 cents per share in the year-ago quarter and the Zacks Consensus Estimate of 79 cents per share. Net sales and financial service revenues in the quarter surged 58% to $4.85 billion, which is the highest quarterly revenue in the company’s history. It also exceeded the Zacks Consensus Estimate of $4.21 billion.
PACCAR expects the truck market to improve in 2012 driven by recovery in the housing market. With the improvement of the truck market and introduction of new vehicles, revenues are expected to reach higher levels in the coming quarters.
Based in Bellevue, Washington, PACCAR Inc., is the third largest manufacturer of heavy-duty trucks (with a capacity of more than 15 metric tons) in the world after Volvo and Daimler. It has substantial manufacturing exposure to light/medium trucks (with a capacity of 6–15 metric tons). The company also provides customer support for its products with the supply of aftermarket parts, finance and leasing services.
PACCAR has two principal business segments: 1) Truck and Other and 2) Financial Services. It competes with companies like Volvo (VOLVY) and Daimler (DDAIF). Currently, the company retains a Zacks #3 Rank on its stock, implying a short-term Hold rating.