Paccar’s chief executive thinks pricing for the company’s trucks could begin to rise as early as the second quarter and expects “that trend carries on even beyond 2025.”
Speaking to analysts and investors after the maker of Peterbilt, Kenworth, and DAF trucks reported fourth-quarter results, CEO Preston Feight said some truckload carriers are beginning to buy equipment again as their market gradually improves. Coupled with a solid less-than-truckload market and a “steady” vocational sector, Feight said, the overall market should strengthen as 2025 progresses.
“We see ... improvement coming throughout the year. We think for sure in the second half, maybe it’s in the second quarter,” Feight said January 28. “We’ll have to watch how the world develops, of course, but it feels like a positive trend.”
Paccar delivered 43,900 trucks to customers worldwide in the last three months of 2024, with 22,300 in the U.S. and Canada. Those figures were down from 51,100 and 28,100, respectively, in late 2023. Those deliveries translated into Q4 revenues of $7.9 billion, down from nearly $9.1 billion in the prior-year quarter, and net income of $872 million versus more than $1.4 billion. Paccar’s revenue per truck fell nearly 5% year over year.
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Carriers bought 268,000 Class 8 trucks in the United States and Canada last year, down from 297,000 in 2023. For 2025, Feight and CFO Harrie Schippers are sticking to their forecast of 250,000 to 280,000 units. Three months ago, Feight said he expected sales to start the year relatively slowly before picking up pace.
Addressing pricing of 2027 model year Paccar trucks that will comply with stricter emissions regulations, Feight said his team continues to tell customers those vehicles will be $10,000 to $15,000 more expensive than today’s models.
Other notes from Paccar’s conference call include:
- The company plans to spend between $700 million and $800 million on capital projects this year. (In 2024, that figure was $796 million.) Schippers said expansion work continues at the Kenworth plant in Chillicothe, Ohio, as well as in Mexico and at the DAF electric truck assembly plant in the Netherlands.
- On the research and development side, Paccar’s leaders plan to commit between $460 million and $500 million this year, up several percentage points from 2024’s $453 million.
Shares of Paccar (Ticker: PCAR) fell more than 2% to $107.25 after reporting results. Over the past six months, they are up about 8%, leaving Paccar with a market capitalization of about $56.2 billion.
