In anticipation of a downturn in the market in Europe and due to the initial effects of the global corona pandemic, the TRATON GROUP recorded falls in unit sales, sales revenue, and operating profit in the first three months of 2020 and is now making preparations for the re-opening of the economy in a very challenging environment. Unit sales of the three brands MAN, Scania, and Volkswagen Caminhões e Ônibus contracted by 20% to 46,000 (prior-year level: 57,200) vehicles in the first three months of the year. With unit sales down 21% to 42,000 (53,000) vehicles, the decline in truck sales was more marked than in buses, where a drop of 4% to around 4,000 (4,200) vehicles was recorded.
“The effects of the corona pandemic are hitting the economy as a whole hard, and that goes for the TRATON GROUP as well. What Europe needs right now are investment incentives for the environmentally friendly modernization of truck fleets as a means to overcome the crisis in this system-critical sector,” said Andreas Renschler, CEO of TRATON and member of the Board of Management at Volkswagen AG.
Between January and March, the TRATON GROUP generated sales revenue of €5.7 billion (€6.4 billion), a year-on-year contraction of 11%. At €161 million (€490 million), the operating profit fell by two thirds. The operating return on sales fell to 2.8% after a figure of 7.6% for the first three months of the previous year. Incoming orders fell by 16% to 54,200 units. The book-to-bill ratio (unit sales divided by incoming orders) was 1.18 compared with 1.13 as recorded for the first three months of 2019.
The drop in unit sales of the three brands Scania, MAN and Volkswagen Caminhões e Ônibus was most marked in Europe (EU27+3 region) with a 30% decline, while South America succeeded in posting a 4% increase in unit sales on the back of a positive showing from Brazil. The increasing spread of the coronavirus in the first three months of the year was an additional burden on unit sales, resulting in closures in our global network of production plants as of mid-March. Since the end of April, the brands of the TRATON GROUP have gradually been restarting production operations.
The TRATON GROUP has responded to the corona crisis with a raft of measures. These include securing the liquidity of the company, as well as setting up emergency plans and introducing temporary production stops. “The effects of the corona pandemic have forced us to reconsider our investment priorities and research and development projects. There is a clear focus on safeguarding liquidity here. And we are bracing ourselves for a substantial decline in both sales revenue and operating profit in the second quarter. All the key figures will be negatively impacted,” said Christian Schulz, CFO of the TRATON GROUP.
SOURCE: TRATON GROUP
