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VW's trucks arm Traton tops forecasts even as markets normalise

Published 04/26/2024, 02:02 AM
Updated 04/26/2024, 05:00 AM
© Reuters. FILE PHOTO: A flag of Volkswagen's truck unit Traton SE is pictured at Frankfurt Stock Exchange during Traton's initial public offering (IPO) in Frankfurt, Germany, June 28, 2019. REUTERS/Ralph Orlowski/File Photo
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By Eva Orsolya Papp and Tristan Veyet

(Reuters) -Volkswagen's truck making unit Traton beat first-quarter sales and profit forecasts on Friday, helped by a rise in average prices, even as demand weakens after a strong 2023.

"Demand in the European truck business continued to normalize. Our vehicle services business, which remains very strong, is a cornerstone we can rely on," CEO Christian Levin said in a statement.

The maker of MAN and Scania lorries posted sales revenue of 11.8 billion euros ($12.7 billion) for January-March, up 5% from a year earlier. That beat analysts' average estimate of 11.2 billion euros in a poll by Vara Research.

Traton's operating result increased by 26.7% to 1.06 billion euros, also ahead of the estimated 948 million euros.

The company's shares were up 5.8% at 0850 GMT, with Jefferies analysts saying the quarterly result could raise full-year expectations.

However, Traton also reported a 3% decline in new orders, mirroring peers Volvo (OTC:VLVLY) and Daimler (OTC:MBGAF) Truck earlier this month.

European truck makers are facing a tougher 2024, with a downturn in Europe and North America after pent-up post-pandemic demand drove sales to historic highs last year. A decline in deliveries is widely expected this year before a projected return to growth in 2025.

© Reuters. FILE PHOTO: A flag of Volkswagen's truck unit Traton SE is pictured at Frankfurt Stock Exchange during Traton's initial public offering (IPO) in Frankfurt, Germany, June 28, 2019. REUTERS/Ralph Orlowski/File Photo

Traton reaffirmed its 2024 guidance, including for unit sales within a range of down 5% to up 10%.

($1 = 0.9326 euros)

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