First quarter net sales and financial service revenues decreased to $1.5 billion, 34% lower than the $2.3 billion reported for the comparable period in 2000. Net income dropped to $44.3 million, down substantially from the $154.9 million earned in the first quarter of 2000.
“The financial results reflect a recessionary truck market in North America comparable to 1990-91,” Pigott said. “The industry is being severely impacted by high levels of new and used truck inventory, lower freight tonnage, and high fuel and insurance costs.”
In response to deteriorating industry demand, Paccar has lowered production at its North American facilities and is continuing to aggressively reduce costs throughout the company. U.S. and Canadian Class 8 production in the first quarter of 2001 was nearly 20% lower compared to the fourth quarter of 2000.
The picture is no better in Europe, added Paccar president David Hovind. “In Europe, the truck market is being impacted by the slowing global economy, and truck production is expected to be lower by at least 10% in 2001,” he said.
Though revenues from Paccar’s leasing subsidiary were up, net income dropped sharply. Paccar Leasing’s first-quarter revenues grew by 11% to $120.4 million, from $108.5 million in the same quarter of 2000. Pretax income of $11.7 million reflected a 39% decline over last year’s first quarter.
