The TRATON GROUP increased sales and earnings in a challenging year 2019 and is now preparing for the upcoming economic challenges and the effects of the coronavirus pandemic with targeted measures. The TRATON GROUP brands subsequently temporarily closed several plants. MAN Truck & Bus has applied for short-time work for the German plants today. “In the current crisis, the commercial vehicle industry is playing an important role in supplying the population with food and medicines,” said Andreas Renschler, TRATON CEO and member of the Board of Management of Volkswagen AG.
As one of the largest commercial vehicle manufacturers in Europe, the TRATON GROUP wants to fulfill its special responsibility in this exceptional situation. “That is why we do everything we can to maintain service and spare parts supply for our customers. The delivery of food and medicine can only be ensured if the delivery traffic on the road works without restrictions, ”said Renschler, adding:“ In this very challenging situation, 2019 seems to be a long time ago. But we can be proud of what we have achieved. ”
Outlook for 2020
“In our annual report, which was drawn up on February 10, 2020, we expected a moderate decline in sales and revenue for 2020 ,” said TRATON CFO Christian Schulz . “The current corona virus pandemic, however, makes it impossible to make a reliable estimate of the development of the sales markets and thus of the course of our business development for the current year. In this very difficult situation for the entire economy, it helps that we can rely on a rock-solid balance sheet structure. For example, the net liquidity of our industrial business at the end of 2019 was €1.5 billion, ”said Schulz.
The TRATON GROUP at a glance
In 2019, sales grew 4% compared to 2018 to €26.9 billion. Adjusted for the Volkswagen used vehicle dealership and service GmbH (“VGSG”) sold at the beginning of the year, which had generated sales of €585 million in the previous year, the sales increase was 6%. The operating result rose by 25%, reaching €1.9 billion (previous year: € .5 billion). %. The operating return increased to 7.0%, after 5.8% in 2018. The order intake decreased by 7% to 227,200 orders. The book-to-bill ratio, i.e. the ratio of incoming orders to sales, was 0.91 below the previous year’s level (0.95).
In the Industrial Business segment, sales grew 6% to €26.4 (25.0) billion. The new vehicle business made a major contribution to this. The operating result amounted to €1.7 (1.3) billion, an increase of 29%.
The Financial Services segment generated sales of €849m (760m) and an operating profit of €142m (138m).
An overview of the operational units
Scania Vehicles & Services increased sales by 3% to 99,500 (96,500) vehicles. The turnover increased by 7% to €13.9 (13) billion. The operating result rose to €1.5 (1.2) billion by 25%. The operating return reached 10.8 (9.3)%.
MAN Truck & Bus achieved sales of 105,000 (103,000) vehicles, an increase of 2%. The MAN TGE van range played a large part in this, with sales almost doubling to 15,000 vehicles. The sales increased by 3% to €11.1 (10.8) billion. The operating result amounted to €371 (402) million by 8% on the previous year. This corresponds to an operating return of 3.3 (3.7)%.
Volkswagen Caminhões e Ônibus increased sales by 15% to 41,900 (36,400) vehicles, benefiting from the positive development of the Latin American market. The turnover grew by 22% to €1.7 (1.4) billion. The operating result almost doubled to €55 (28) million. The operating return rose to 3.2 (2.0)%.
With its realignment, MAN Truck & Bus is striving to ensure future viability
The TRATON GROUP brands work continuously to improve their profitability. MAN Truck & Bus is aiming for a return of 8% in the medium term. This was clearly missed last year. MAN is now changing course with a fundamental realignment. “MAN Truck & Bus has to be prepared for the challenges ahead, such as investments in electric mobility and increasing digitalization. Only with a realignment of MAN Truck & Bus can the future success of our strong brand in a technologically highly demanding market be ensured in the long term, ”says Renschler.
The Executive Board of MAN Truck & Bus has already started talks with the works council on how to structure the realignment.