The continuing unstable global economic outlook and the headwinds it has created as well as write downs on the back of Russia’s invasion of the Ukraine, has meant Swedish truck maker Scania has posted some operating losses for the third quarter of 2022 and also across the first nine months of the year, despite turnover and gross operating profits being up.
Scania has reported that with the continued unstable macroeconomic and geopolitical situation as well as high inflation, interest rate hikes and an energy crisis in Europe it registered a 29 per cent increase in net sales for the third quarter to turnover $AUD 6.005 billion. (SEK 41.492 billion), while its adjusted operating income was up 22.3 per cent to $AUD531 million (SEK3759 million). Despite all that the Traton subsidiary registered a loss on operating income of $AUD270.9 million (SEK1917) as a result of a write down of $AUD 800 million ( SEK5.7billion) on the disposal of its Russia=n business activities.
For the first nine months of 2022 the company increased its net sales by nine per cent to $AUD 16.56 billion (SEK117,182 million), while both adjusted operating income and operating income were both significantly down
Scania global president and CEO Christian Levin noted that the third quarter had been characterised by the continued unstable macroeconomic and geopolitical situation, high inflation, interest rate hikes and energy crisis in Europe now point to a weaker economic development.
“Demand for Scania’s trucks remains strong globally but in some European markets we can see slightly lower transport activity among our customers,” the Scania boss said.
“This is however not reflected in the order intake, with orders for trucks still strong and we are continuing to be restrictive in the placing of orders to ensure the quality of the order book and the ability to adjust prices to the high cost inflation,” Levin added.
Levin said that In Scania’s bus and coach operations the recovery is continuing in line with the improving pandemic situation in large parts of the world, while within its Power Solutions division, demand is also strong, due to high activity among OEM manufacturers.
“Scania’s important service business is continuing to grow and underlying demand also remains robust in the Financial Services segment,” The CEO added.
Levin said that the supply chain, which was disrupted by component shortages for much of the year, is now more stable and during the quarter we managed to increase the volume of deliveries to our customers.
“The bottle neck of the supply chain has shifted from components, to a lack of transport capacity due to Russia’s war against Ukraine,” Levin said.
He said that the increased sales in the third quarter had a positive impact on earnings, partly offset by increased cost of input goods and less than full capacity utilisation in production.
“Earnings were also impacted negatively by write-downs related to the disposal of Scania’s business activities in Russia,” Levin underlined
He said that the outlook for the business climate is difficult to predict with all this uncertainty in the global economy.
“We remain focused on Scania’s purpose and continue to make key strategic investments, which in the slightly longer term are absolutely crucial for driving the shift towards a sustainable transport system,” Levin said.
“It is equally important that decision-makers worldwide do not deprioritise sustainability but instead see the opportunities in the shift, reduce uncertainty and promote infrastructural investments relating to electrification and biofuels,” he added.
“Scania is continuing its electrification journey and at the IAA trade fair we showcased an extensive offering of electric vehicles, including our latest addition – an electric truck for regional transport.”
“We also pushed for biogas, a solution that will need to be used increasingly if we are to reach the climate targets, especially in light of the energy crisis and Scania displayed its expanded biogas offering for heavy trucks by introducing two new biogas engines, which goes hand in hand with the major initiative in tank solutions for gas-powered vehicles we unveiled earlier this year,” he said.
The Scania boss also emphasised the brand’s 13-litre engine offer of 420 or 460 horsepower, which he pointed out, now covers a very large share of that part of the European truck market which needs more powerful solutions, including long-haulage trucks.”
Meantime here in Australia Scania delivered 799 trucks, 149 buses and 88 industrial and marine engines for the first 9 months.
While the local operation was happy with the result it did point out that truck and bus deliveries had been somewhat hampered by ongoing supply difficulties, although like other makers its order rates remain constant
