Daimler Truck reduces forecast due to American import taxes
Moving Forward: A Blip in Daimler Truck's Steady Stride
Daimler Truck, the leading commercial vehicle behemoth, has shaken up its financial expectations for the year, blaming the murky waters of North America as a key factor. This shift comes from none other than CEO Karin Radström, who now predicts a dip in truck sales — and therefore revenue and profits — for the company, based on their Leinfelden-Echterdingen announcements.
In the North American market, Daimler Truck now foresees selling only 155,000 to 175,000 trucks this year. This figure is a significant drop from the initial forecast of 180,000 to 200,000 units. The company has also revised its estimate of the overall heavy-duty truck market on the highway.
With a strong foothold in the US, Daimler Truck's main brands Freightliner and Western Star have secured their status as the leading players in the heavy-duty truck segment. This sector is where the company earns the majority of its revenue. Now, they anticipate selling 430,000 to 460,000 vehicles globally, a decrease from their previous forecast of 460,000 to 480,000 units.
Radström now envisions revenue of 48 to 51 billion euros from the industrial business excluding financial services by 2025. The adjusted operating profit is now expected to range from a decrease to an increase of 5% compared to the previous year.
Previously, Daimler Truck had targeted industrial business revenue of 52 to 54 billion euros and an increase in operating profit of 5 to 15%.
Although Daimler Truck isn't exactly sounding the alarm bells, it's clear that uncertainty in North America is causing a ripple effect. But it's not all gloomy: the company recently showed strong performance in the third quarter of 2022, boosting revenue expectations to €50-52 billion for the full year — a positive adjustment from the initial range of €48-50 billion. This increase reflects improved business conditions, enhanced net pricing, and increased unit sales, despite facing challenges in the supply chain.
As for the US tariffs' impact on the North American market, while there's no specific mention in the available information, the company did revise its Class 8 truck sales forecast for North America in 2025, lowering it from 280,000-320,000 units to 260,000-290,000 due to market instability. This revision indicates that broader market conditions, rather than tariffs specifically, might be shaping Daimler Truck's strategies in North America. For a comprehensive understanding of the tariffs' effect on this market, further analysis considering current trade policies is required.
Daimler Truck's revised expectations for the year include a decrease in heavy-duty truck sales within the North American business, leading to fluctuations in revenue and profits. The company's revised forecast for industrial business excluding financial services predicts revenue of 48 to 51 billion euros by 2025, a decrease from the initial target of 52 to 54 billion euros.
