PACCAR (PCAR) 23 Jul 242024 Q2 Earnings call transcript

Good morning, and welcome to PACCAR's Second Quarter 2024 Earnings Conference Call. Today's call is being recorded. [Operator Instructions] I would now like to introduce Mr. Ken Hastings, PACCAR's Director of Investor Relations. Mr. ahead. go please Hastings,

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

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

For page our at see introduce SEC Relations now would the like to Investor additional information, paccar.com. I Preston filings please Feight. and

were Parts' profits income And quarter $X.X XX.X% to Parts billion were PACCAR performance strong increased Truck, million. Financial income strong in truck very you highlights. excellent and billion of with revenues gross and to our Well, margins revenues in parts were XX% and financial and results the like quarter I'd PACCAR's group achieved pretax on provide trucks $XXX excellent $X.XX PACCAR operations million, our really an the saying billion. Brice, $XXX good great will morning. Harrie, margin. thank $X.X world. the Parts and business second customers to of around impressive best people. PACCAR's the start Ken Other the are to by and second who pretax you of net of of due world. second with They quarter. solutions employees update gross transportation good I

with is The The Class infrastructure a X truckload soft. year's to be period market same are and up remain market Canadian and estimate U.S. Looking by XXX,XXX strong well, range XX.X% where with last offset of medium-duty market this be truck market at to technology Peterbilt medium-duty year. We to to first customers significantly and being the market. investments. are vocational where half grew a XXX,XXX softer We new to best XX.X% segment same in the months XX.X%, Demand Peterbilt market a remain share in be of U.S. strong. the first provide also while the Kenworth in the this trucks. Canadian segment and and XX.X% XX-tonne leaders operating Kenworth continued rates the Europe, Peterbilt's year. Kenworth premium less-than-truckload performing have from continues the XXXX to to European year period truck XXX,XXX X increased in trucks share range in this DAF's economies compared project above for and year. In efficiency. to market last the in the their trucks trucks. XXX,XXX latest

share Brazil market to ago. trucks America growth. South in of this months geographic to first are PACCAR's a DAF by increased X desired region XX.X% in a South of year DAF customers America. highly compared the year is X.X%

This a highlights. as to new Technologies batteries Harrie? cycles. produce joint will future. Harrie expanding that is Amplify few quarters, demonstrate through of Technologies, construction the specifically the joint with about Cummins, Energy. global Truck and other PACCAR designed vehicle Schippers began Amplify updating commercial we've that are Cell on and business of Daimler formed quarter. PACCAR Over an venture its battery provide PACCAR update of will the progress the last PACCAR on factory Financial second the phases Services we duty the cycle continues are venture for state-of-the-art now EVE in capacity business strong all and excited you Parts, been performance manufacturing named Cell

XX,XXX deliveries Truck, trucks of quarter. XX% trucks, XX,XXX estimate margins in Truck, the third with and XX,XXX Parts quarter to strong PACCAR and XX%. Preston. We around Other and gross of second margins be gross Thanks, achieved delivered excellent Other Parts around to

grow Europe. PACCAR receiving increases year. new shutdown These X% supporting for customer success. a new second lineup, truck X% delivery of technologies customers' a year the continue for dealers businesses Each expanding number semi-production We'd and Colombia compared position Financial center expanding States, benefiting estimate parts our your on distribution pretax opened softer as the innovative, XX% same excellent and on in is Financial growth in million and operational in continued normal connected development the answer having well $XXX the today half reflecting investments providing normal our period enabling are is $XXX to driver Services' Services the in the and million distribution full last distribution vehicle expected achieved income our million zero-emission the include the to you. the full this of and this advanced rest manufacturing will systems was in this around range projecting of Parts country diesel PACCAR from $XXX PACCAR as to another Parts the well market. center and open of efficiency. PACCAR an to year. In new investments focus capacity, Parts' United as growth to its gross markets. Europe, of this manufacturing XX.X%. in capacity Parts solutions customers' portfolio advanced by is quarter we year. the return year. third year and markets high-quality and pleased a capital million, regular innovation best-in-class industry-leading range quarter projects. aftersales PACCAR's as assistance truck in and planning we be reflects questions. good another The These factories of suite of million second same transportation efficient achieved a and enhance quarterly base, future. Thank grew services of quarter $XXX Parts of customers in later high-quality, truck range quarter revenue PACCAR is on its that in or in solid next center we're the clean industry-leading sales technology its day. PACCAR margins at to used of PACCAR and powertrains, Germany $XXX Financial and invested capital of key continue PACCAR's and Australia. company for XXXX, the first R&D Brazil invest expenses in Mexico, investments second

[Operator of Instructions] Our line comes Jefferies. first from the Volkmann question today Stephen with

there regulations sort be there's I'm It a R&D in the question change I is me change a with that kind key seeing. CapEx potential ramp we're assuming would emission worry of government. the around that of that The your if of probably strikes that one And about things actually and would actually you're various must guys different not risk of target to have pontificate in to asking connections on some have you actually good regulations? Washington. mind outcome But certainly is what the this. do that the relative something moves your these in and to than currently a may here that And doing you you

form customers. transportation to question. to time really start the They expenses improvements Thanks that and Good in trucks to to good just but it. come solutions efficiency saying the in reason and of work our is related on. operating have CapEx R&D ask of the taking also for of a are can technology our by because upwards lot projects we I'd we moving emissions provide

now. them, that's and we we invest what good projects, right in set So have a doing when we're of

of we period in emissions a is don't it over Regarding And it's change the number time. the delivers might shift answer timing we changes unlikely those. PACCAR what that have year few the do just that. total the trucks regulations, to of and think won't of It

to speak with capacity adding you these investments? can the across Okay. Great. you're how And broadly much various system

that intention to is We've our shared with market you previously share. our grow

grow that that conditions we're if that similar we markets and align as well. getting saw market share those kind in in to with XXXX, what what so are see market so is we And that we of capacity doing peak can

you it increase think as So like capacity. some in XX% XX%, a to case, could in of

line next with Fisher of UBS. Our the from comes Steven question

and the there. little a how or in sense that more might if effect Any Truck, to mix bit. perhaps give I wanted of expected Parts from of have Can just just much us Trucks pressure? supportive. there's Any would I margins be there? XX% in costs a QX thought pricing little you a unpack versus onetime Parts any Other or changes

Just any way to bit. little unpack that XX% a

think are big in there's rates customers' there. as And opportunity of in say a holiday Well, there's takes I typical out, remember, saying onetime our units sector, low. we QX, at third that it. cost has balance for in pricing Europe, has I'd no look that by a in some well. impact But and quarter which I impact start the that as would season few thousand remaining sitting to the thing truckload some also

about And the negative and margin quarter, a you down. was Okay. can what QX? then the surprising QX maybe just on in for what incrementals quarter maybe and tick this specifically drove It you're Parts the expecting talk

kind a this maybe maybe wondering just any sort is the more period a broader onetime of after there of correction strong Just is if cycle. Or of dynamic?

is it's what really just are when last comps and I not. supply, constrained think No, at you the year from the now look was strong by market

the everybody So truck parts participating market. think in and is I the

a be I and mean are job. strong. margins think to I fantastic is the Parts just continue strong very doing team XX.X%

market. comes year. along that we're improvement our we as this down obviously, that So of time the of is see keep sure the that I would remind kind aftersales think we share we'll in those again. making But market

down a testament gradabilities. growing so environment aftersales a in And is their Parts to

still XX%. achieving margins And above

comes JPMorgan. question Tami of next from with Zakaria The the line

Is you So and seen seasonal I heard thinking a this last quarter. typically about year say how than Europe over as third think, higher the that well? I quarter we QX Preston we've some years, few actually bit deliveries the I be just that fourth think -- should sees shutdown,

No.

lot think like there's you a of previous couple other at of timing in I deliveries. of years mean a period factors I we'd term ago. things. that see to all tags was use, of you a can more There what the the look red years, the driving

say in normal feels that operating XX,XXX XX,XXX you'd healthy now think to but expect have and you I to right in So deliveries more that normal we're to QX a and good, be environment range.

trying of you helpful. tweaked understand the in category outlook about last I'm by What XX,XXX it. And months U.S./Canada reduce which to pockets within versus is drove my lower outlook? to of weakness? the you second the few think is, that units. the some are Got What weakened bucket that I That's then strength question

us. and still the LTL with Kenworth market see question our still point in are totality remains trucks, off about market-leading for Tami. levels. of market. Sure, sector Good we to normal What low bottom that's think spot the expectation strong starting vocational for We healthy But rates seeing our have customers been of The of it. a in truckload the Peterbilt at cadence might with think have for the demand And space. like to contract remains market at there lift the that this lot to low that a and is rates I kind them. maybe at the an levels part

from Our next Morgan question comes Angel with Castillo Stanley.

go could that kind of cost, Just comment perhaps back just of wanted trucks, full the cost comment to for segment, business. around about the expand price equipment on and broadly price we the the more Parts parts to and kind -- if

it think any if curious business. both there? just as share pressure about Parts bit little across kind in cost to be also the trucks but in as business, well more to a pricing under price we maintaining comment weakness parts, your And or and in that around going strategy negative pricing Just strategy, how of broader the pertains should is

X%. second the Cost price for slightly was price in business, Trucks, Cost pretty in the less more If so was quarter much than up up was look was X%. up at cost balance. X%. than Price up we X%, Parts slightly

saw smaller, pressure and gross that U.S. margin this we in Parts the especially nice XX.X% the more bit year. margin the overall for you into parts really little a take markets in but So as a performance were account Canada if aftermarket there

parts and market that's aftersales I division what market showing transportation team up products and of think high-quality Kenworth providing, is share I there. a our our smaller truck and are fact kind a Peterbilt just said, in in Just it's year is solutions last just that is testament think the a the market growing to team and that's the growing declining, Angel, Harrie that

even of as heading And path, That's comment. visibility talk into maybe your quarter helpful. just -- continue kind about book rate fourth third down for in about of of just you orders, beyond that fill quarter the think we in maybe and terms very that could to the just the any have you quarter, just level order fourth

you Angel. do Sure. Happy bet. that, to Yes,

we quarter, in the half and If we're at quarter quarter you look the we're but full. in the have full over third openings for quarter substantially few left fourth the a third

before, then be think, the So where are and the obviously, for segment is as market. their And decide we we have the is the greatest then place the less-than-truckload the said the LTL year. truckload to to strength trying vocational of going carriers, what I balance market, cadence

from with question next Our comes Jamie Cook Truist.

X Back relative guess mean, to questions. or XX,XXX. I your deliveries were I of -- just think your to I -- your XX,XXX orders, expectation sorry,

little was of at the to XX.X%. of margin XX% your targeted a ahead, but end So your range lower

else into expect that And negative else unusual relative forecast you anything guess just So XX% of was I'm then besides I price to down continue do deliveries your down wondering XX% of anything sort half that. I cost think down on quarter? And if Europe, just headwind spoke sales your price/cost you follow-up there's margin to. industry for there the to my then impacting the first are fourth to on be the retail question to XX%. the

first implies or in underperforming underperforming market, least color any on the the year? we that? Just the of you're half are why So at

Sure, Jamie.

but that X think it's the get to I nice questions, was to from from questions hear you, you. and actually good

happen. the commentary at -- that. industry what look a that thought not any around exactly -- kind issue kind supplier other XX,XXX manage It's of had had the we had of we'd XX%, an that. we share to you in quarter, and Mexico the had in a we through really the If different anything the there's on and we Obviously, would had

So I think that we managed through.

job working job the did a Our to that number. and XX,XXX to that allowed a with great who teams fantastic get supplier did us recovering

our and strong teams teams So to out, getting our that that ops for to suppliers, led kudos kudos to the sorted the performance. and

be think QX in into challenges there, right the implied similar cost carriers strong I watching truckload go looking we by reason we're performing could they're to think QX their and price I say and the being markets making from but from QX us that where and and of they you a vocational should that front how now seeing and and in that the have trend at medium-duty that very decisions is good LTL offset truck. XX%, in sitting the again, with

Harrie, basis So the trucks in are say. And I'd of commentary the EU. performing well. it's any just contract on trends rates, the maybe, then underlying

the And and XX% Europe volumes mentioned, you were where down Europe, as is Eastern Jamie, Central strong, especially DAF softening. is market in

DAF through And so working is that.

our continue benefit pricing has fuel a position. positioned and the new We it's which this to economy in premium in industry, from best -- our DAF, for

in little impact weaker So than that do we'll continue to a European for benefit Central and But an have from Eastern markets on DAF bit that. more Europe proportional general.

right reemphasize And the pricing I I now. is just good it, team very you think, but fact the of discipline the Harrie, said that

from comes with David question Raso The next Evercore ISI.

in into bit tone 'XX, with can your about customers to But plans potential in of North Has the politically? we've month changed you're elevated, inventory. with gain on share is The trying already is prebuy. be conversation U.S., you of below looking call share just the and then the have going backlog regarding just follow-up X. to putting it know year. industry And you've a I'm for America curious, this thoughtful the or I Canada, at gained to quick inventory pushing build a I a already right? last motion the I seen all was the conversations just what

about the 'XX your if you again, do into inventory So just how back question prebuy. see 'XX and to exiting the can, circle you

Yes, sure.

think in prebuy, out with a The lot we're sitting our any been EP don't assumptions. customers. time in their of David, spending So there's of I there change there kind already. are rules

probably wouldn't, they'll speculative. out I to they think hypothesize easy that's I It's remain there. but think

in into right be any buying And change then in don't now. so figure there's what I 'XX. and But think to plans their out think they're trying I will assumption 'XX

there. well moved of I used. a being are freight lot think out trucks being is There

replacement consumed and are healthily they'll need trucks some being point. So a at

also very is the say at an is retail sales like standpoint, at months X.X healthy a inventory from PACCAR I'd X.X months. industry of that and

So to inventory are like to we good gain, share as add we're in I that, high feel levels our the shape, at. also our our have vocational really inventory that that's seeing share that market would we is where and fact contributing such a

of inventory the we're for quite us share growth So terms in realizing. good things with feel

And that looking having, visibility just PACCAR. bit that's market into you for can a you're limiting vocational key already say, the supplier it's locations strength maybe many Obviously, comment you given on follow I sell. can 'XX where just how little Are a vocational. at up better on a

vocational but how think particular? versus, should about we all into the 'XX prebuy we in a through Just can't obviously, not, think or vocation

bet. You

that really reshoring I that's that it, be the constraints been happening, vocational think just while, have there in amount the vocational bodes for that going to with strong in a well infrastructure seems of the the and call U.S. or of the side supply a inventory and getting spending market. the in for market

of strength that see think a for I So quite period time. steady we

Our Revich Sachs. next comes Goldman question with Jerry from

of up Are On accrual stand playing margin we the numbers? Where see starting down? were to on we paying costs you out I to years, starting warranty higher for put out in warranty while had warranties, warranties, Are do folks tailwind period. ask rates past really just wanted for now? of good that couple come your the that

customers that Warranty favorable, reflects experiencing. are has trucks Jerry. excellent the and and it building developing we're very observation, good currently been Yes, that cost

direction. So the yes, right that's moving into

Parts for And the What cost I recoup business it see we number the your Is for can continuing up was reaccelerating Parts to Harrie, X% to drove about I per cost what's X% the that heard rate? for this outlook think it if unit year-over-year. for business? fair ask at right, And pricing if Parts that?

I were as pricing, expect I X%, said think favorable we through and costs see year. pricing continue developments pricing to the we was up and for the X% up to move

look I to in we specifically, outer Parts think in as start versus see price maybe improvement on forward the quarter. the some cost would side, we

is wondering quarter, just I'm a spoke it Or earlier? to just transitory? OEM in that was a that broad how inflation one-off based just was about you we the saw just the related it supplier was that So on issue side? the

increase Parts cost It's a earlier trucking X% versus inflation, softer reflects that The business. broad-based. during in America different is cost mainly than is and aftersales price North the business we the call. But about little the the talked market

Got of specs. on in if are your performance could on that us lastly, And Super. it. you I California the new wonder update the just emission trucks

what's So fuel since new the economy out and been the rolled performance broader you've engines?

a is aware Truck of and compliant. ones I has the Clean market California are engine a that that say come the Advanced breath, have rules an pause and that taken a bit Fleet, that we Advanced of, the fully has down market I'm The have developed Clean is a place, only think, slowed into engine

leading And so was look that. and the there is the market because market is be into of at XXXX kind last for lot there an carryover the that to be pleased but entering early technology from really will of way year engine and just that engine a entering

Chad Dillard from comes question Bernstein. next with The

a hard is this question. So

comes X on seize was, if part. it So then industry holding hold means years say, to if price ago, the willing the to has share And That's how market changed? ability today let's a is compare second, to what first you industry's it PACCAR if line price? truck the it, it to on the truck

there. today thinking love That's a in question first market truck ability. -- And I and about the great the your

think great lower market a is in -- that today, of I total has the point cost PACCAR to ownership than access products any that providing are more history.

is able more trucks doing a I to that's over these cycle, And so our we're margins contributing be be successful, better to And Parts our more businesses more successful. cycle I operators that. PACCAR more get helping to is them, think and and where which structurally them. same we're to our are And where stronger we're transportation the realize customers solutions customers to helpful the our day, valuable true on same to which able our think and also in PACCAR is parts highly

So that business well. I stronger working think structurally why the is that's so

of things reductions. the drives gas The also one that on legislation greenhouse the Chad, thing -- this, is one

we've So last improvement years, over which fuel the customers. improving been X greenhouse means X, emissions, economy gas for our

buy lot X you customers. a of if today with a that that's value you'll truck economy, XX%, ago, better means our years compared a XX% and for it get fuel creating truck new So to

seize you. the [ to then Got share to, with hold is market willing part And ] to the truck on comes second price? inventory PACCAR line

team in XX.X% growth year now mean fantastic has what and Well, right balance. now. think in the we're right doing to we've share delivered gross a done both the looking margins I what at last look realizing gone I is second job that of at the proud they're in from I year keeping XX% quarter. of I'm really this XX.X%

comes Rob with next question Melius from Research. Our Wertheimer

the Preston, that performance more whatever, remarkable. but sleeper know mix the there's probably seems I comments, [indiscernible] more on vocational a and is probably it like or broad-based. than benefit it's cabs I versus share

any to from [ of comments or that great what's wonder sustainability I have just ] if on the help it you aside products. So driven

Sure.

It's the a is Parts that the market just or helping also offer the services. I that fantastic the we helpful to new well. is, support, grown and supportive dealer I in last we've we right? our done don't and think medium-duty contributing great as And our share customers, the product really we've that I in also anything where the of who's strong job customers' over a few wisely performing right, we've side, organization a think vocational development we there but that exceptionally said, shared network good the a we you It's efforts, trucks new us. of well often can research And upgrades, just with and the see for a taking care is And as businesses. And we and are it's as years, and our invested structurally growth. you in product. are mentioned, have out you, And customers. Harrie, you'd I that's and financial one them spent heavy-duty side, leader all say our to that we're the additive market product, new introduced also think of not as significantly other. then add? of with fantastic

The I and with last think were we doing with also the supply we're great or the years, back held X what opportunity X to share, by base grow supplier we now capacity new get and that's up, the easing products. market

[indiscernible] comments I of any you those JV, know you And batteries? makes and the have clear out where just a will on ramp you're the is don't whether market to offtake Or absorb whether still sense. But Okay, thoughts it's the still it's is? still may, that do be any I I'll I going products batteries. to stop evolution ways whether the introducing on that the largely duty that or that develop. battery of know, and will If on medium there.

Great question.

what I and for commercial for the trying future. reason we is in develop in venture we're great the of batteries did market joint this vehicle part a the we them. optimized to were position to that had cost wanted a think it's all It's understand

have we there. the So products most competitive out

to be a where ownership pickup so in benefits applications or local your start, could area. of cost could I get cost. The So of battery charging be with a primary total trucks return duty medium operation, we and that get will in you [ but ] also but keep here, can positive base, delivery we think, scale

this markets be decision just way to proven be to North as And we the it. I will be into kind would a offtake. good I think, thought solution. significantly I think serve use not have It's can before think of take, we well. how more over-the-road the this America. it that about it was translate will And battery structured we time an other factory to But

next Our Nicole Bank. with comes DeBlase question from Deutsche

just I maybe delivery with guess starting XQ outlook. the

has So flat in units. I an of know the U.S. that we've shutdown thousand delivery kind to Canada and slightly production Does a of down which few got imply usual perspective? that Europe, is from a impact

I Nicole, that between think delivery shift look the is other the that's saying of it, then is half and would I total XQ QX market... at and

Market in North America...

that Market in I in adjustments North would are say reflecting America that.

I guys And not potentially had clear. you it. like what Or the price. to different question the only Okay. a on pricing ways. negative back have expect point then a sorry within But that half? know Truck is guys Got could belabor the segment in there to this go That's would million risk is that you see?

So guidance quarter, we Fourth call, gave we'll quarter next margin. XX% that excellent the for gross the Nicole. an with about third talk during

Yes.

just that not at look price right I as much saying would but also have price think opportunity, the I it while in now. could some say as also costs effective might that is feeling market. you

as QX talked we next And think, clear definitely we'll in so gets update said, the call. I you in less but the about QX, you

Menges comes with question Kyle from next Our Citigroup.

as another growth think year-over-year a back Parts I XQ? Should guide XQ X% half that in outlook, just wanted to growth then X% in and clarify in the about the we year. for of X% growth the

right. about sounds That

of I'm then how And curious that of much the does Okay. centers these opening some growth distribution impact outlook?

the you gives in better it distribution benefits add it It's and proximity growth, dealer delivery and that parts center results customers. but for support Parts growth. our performance us a not automatically that They if capacity

only that part drives not supports it's So it sales. the the But the definitely growth. thing

Yes.

contributes customers the success Harrie are for Parts I'd exactly which our team. to said, to our long-term -- that build thinking, echo of fact strategic performance better system deliveries, and think and these support the ability I same-day and get investments what a right? the They long-term just

next comes Group Research. question Scott with Wolfe The from

on at have said point, you selling out you were price of some for normal what's XX% just XX% So roughly for just year color for the start this -- I 'XX, Do or point then start think you 'XX trucks? not? is -- XX% any as any fourth at trucks quarter. And the you right directional sold that perspective, about

XQ extremely I normal. Yes. of this XX% full time year is mean, the for

term, over kind we went that wheelhouse that's to We And well. if see I early about it's the perform talk PACCAR too. the is So right what a longest And market this normal. in the you can see in of back pricing. think successful too normal XXXX market where of very

Okay. see the color trending year? back half any used And and on you quickly, truck pricing of just the how in then that

Yes. Harrie. Sure,

also the Used normal North down continue that come to inventories in more to especially second truck in And with half at year. prices of this have America, normal levels. we expect levels,

think Meaning Or that sort stabilize you they continue trend they think lower? you to here? from of do

expect them and here to from I for Canada. stabilize the would U.S.

question with from of America Michael Feniger next Bank Lynch. The comes Merrill

the that that could you on take quarter segment, there's levels. curious, kind into like you're cycles? XXXX. more are of on experience think bleed low if there's truckload do I'm Just, to the time have through like side X, sounds that side that when on public with obviously, softer curious sounds overcapacity mentioned, into you or particular players, on does to XXXX contract confidence we kind overcapacity vocational your market? the It feel Preston, listening a at rates just like improve can been the there. in rates that based I'm of of It just softness work or

think going good Michael, we're it's a I to -- question.

I and what see is. think watch to will that you have

it. go factors of easy think to obviously it. lot a into There's I that predict it's that not

with a on demonstrating way for our market which great size might making think think in really are you success of of is sure I a the is, cadence doing focus couple turn, be minus. the plus share it, products. quarters good But knowing our that that to whatever we think teams when our that or I of So gain think might in

to mean, needs on EPA know Fair close? 'XX Is to 'XX second investing of order that standards of others there. should questions these too. of capacity many out -- kind in that context too cut are to place be an change just secure start Preston, early sure how can the for should place you I'm of of be a roughly about like emission the there when just slots I other to guys fleet aware curious XX. I'm and others, change curious to it enough. And are, are ahead does the Or or customer emission order changes. secure we so wait a we truck? half anything in sounds prebuy. and there I will making you the think compared It have of or

of I a history into far many long How kind I see to having people their product it think it. will would bring changes. in that on to on when think here. approach want of these And than industry I trend, same they that of cost the have too and depends it emissions forward the look at sooner. And we buy market weigh factors say I think the we'll kind in

Kauffman Partners. question Vertical Jeff next Research comes from with The

My of have been -- my questions point. lot been a this questions asked at have

driving that's of you lineup, So in I -- dominant and product, it. improved, a asked. I let that Wertheimer taking in that the are if and guys got one were to me basis we've share product the have from the existing dig of points XXX market? products you are Rob share gains was know how other out guess, great market market The back into of much mean, it But share outgrowing fantastic, new we're market categories that had and versus you

coming the I fun is the leader. share you I And sectors I then the great answer knew to say would a strong why it, Jeff. And is question, the characteristics where that's wish I but dominant X characterized are the that the of PACCAR products. gain Well, think probably

I if them. on put of kind percentages don't it's necessary So to know

think nice so see well. just say to it's I performing that both we'll

ask congratulations. a if had you view. Well, I'd thought I

bet. You

line comes the BNP question with from Borrega of Miguel Paribas. next The

pricing competitive The you just of see seeing perspective? is pressure. market the segment weaker. environment my Europe, wondering any first any Are attempt in one, price that That's about you today? Traditionally, weaker question. seeing first where you the in that would of to from a some lead discount particular, any in Are obviously

I so. The nice market Europe, do think in new DAF and pricing there. in continue And you're But down. to position we're a we'll pressure premium really does of in right, the team seeing is job keeping Europe the some the

from Europe regional understand Brazil just the good. a rebounding, can terms you moving in the a mix different And of up. us the with you mix, positive color? of U.S. perspective very Can then us whether That's some substantially secondly, the kind down, color contributor and margin give to negative some but help was Canada or parts,

I mix geographical impact overall our don't a think big mix -- on we -- I don't think margin. the has

are performing at well in the cycle. think I this really the point regions all

grown can you things the the South specifically, of to where that's another us one and see think market America helpful strength has share really significantly. I place in is Brazil

good Europe, a with it grown not Obviously big and U.S. performance also. the as contributor positive as in that's way. a So margin but is

the job as right. the are think doing with performance good teams said, keeping the I Harrie balances So all delivering. it's of Pleased a

comes Our next Raymond Tim from Thein question with James.

into I and about softer question know half first point, -- about some as in bleeds back managing as think go market potentially that, had at this assuming that largest looking looking Preston, ever. planned, you the how be ] [ we're Great. softening 'XX, was who But the this legislations a we beyond maybe then you're going year outlook knows. thinking just at of to

-- supply the has off ramp up? of whipped have near conditions but in you then supply you where has how thread term, chain's those around do forces that a struggled to also needle? X chain to So do the yours up, of back jeopardizing ability kind but respond kind ultimately and to ramp industry not kind with where PACCAR does the to How of been how you coming have not of kind to you a question, it's and just balance period the

in you And long it's approach for well. We're a We I Tim, good our customers. Yes, market. obviously, We're the term. think long term. And question. it smart here view keep which long-term know very making our of quite PACCAR is the good investments, are strategic to support the a for

what for We're market quarter. performance in be gradually products a share as our we our increasing might customers of outlook and growing of about and things the concerned right And continue investments future aren't in the started capital mentioned doing works as the business. And Harrie making the we -- and and wisest the And it call out us. way the for that growth, and so possible. quite products that an way the our growing just that's we're going to support going doing in to with

Got it.

order impact just A I'm then of that looking that an the can lot the the call on backlog, you But the in price what here obviously, curious pricing. earlier it on of And the terms of mentioned. -- composition airtime full realization. -- on or comment fourth quarter, specifically just board the that and XX% Okay. to in have the influence

versus for of so any are trucks and but I mean, inventories again, fleet sense specifically, a retail, couldn't mix and year -- now, ago, a obviously, And the terms in not between get bit -- heavy. you

has So of price flipped. guessing just the factor of who discussion terms in in I'm that that a and are? end this ultimate composition buyers the Is orders the

vocational this that I the be say solid. I and would -- call, in hit continues to that of of ways market kind think Well, we've a that couple is

for And us. so strength, good that with that's

making, other bit things timing where in with enter the and I inventory to the this gains in a appropriate come and associated healthy given here tend there's we're mixture sitting compared think months to July into later. industry We're Our quite share of X.X then Fleets feels late little some at truck and at that. is X.X now.

months, for Over balance on capital in what fourth allocation more looks see like what then quarter. the get we'll their that year, the are the they'll next next clarity of and plans couple

queue any other from There company? no at Are the questions there in remarks the this additional are time.

to you, for the like joining everyone call, We'd thank thank and operator.

earnings Thank you concludes gentlemen, Ladies call. and PACCAR's this for participating.

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