The TRATON GROUP felt the anticipated market decline in Europe and the effects of the global COVID-19 pandemic in the first nine months of 2020. However, the cost-cutting measures TRATON instigated early on and the recovery in the market meant that business stabilized recently, enabling the Group to post an operating profit of €162 million in the third quarter. Unit sales of the three brands Scania, MAN and Volkswagen Caminhões e Ônibus contracted by 29% to 127,700 (9M 2019: 179,100) vehicles from January to September. Unit sales for trucks (including the MAN TGE van) fell 29% to 115,800 (9M 2019: 163,300) vehicles, slightly higher than the 25% fall for buses to 11,800 (9M 2019: 15,800) vehicles.
The decline in unit sales in truck business (including the MAN TGE van) at the three brands Scania, MAN and Volkswagen Caminhões e Ônibus was sharpest in Europe (EU27+3) at –37%. The South American market also suffered from the consequences of the COVID-19 pandemic: The Group’s unit sales of trucks shrank by 20% there. The decline in bus business was likewise stronger in Europe (EU 27+3) at –21% than in South America (–14%).
“Our business picked up recently following the sharp market slump in the second quarter as a result of the COVID-19 pandemic. The measures we have initiated at the brand level are gaining traction and we continue to make ourselves fit for the future,” said Matthias Gründler, CEO of the TRATON GROUP.
Sales revenue of the TRATON GROUP from January to September fell 21% year-on-year to €15.7 billion (9M 2019: €19.8 billion). The operating loss was €58 million (9M 2019: operating profit of €1,482 million). The operating return on sales fell to –0.4%, compared to 7.5% in the first nine months of the prior year. Incoming orders decreased by 14% to 145,900 (9M 2019: 169,700) orders. The book-to-bill ratio, the ratio of incoming orders to unit sales, was 1.14 above the level of the first nine months of 2019 (0.95).
“We took stringent cost management measures early on to adapt the TRATON GROUP to the tough economic climate. We saw the initial successes from that step in the third quarter. Nevertheless, we need to keep a strict focus on reducing costs,” said TRATON CFO Christian Schulz. Following a sharp negative impact on the net cash flow in the second quarter due to the COVID-19 pandemic, the Group again posted a positive net cash flow of €199 million in the Industrial Business segment in the third quarter. Since the market has recovered faster than assumed, incoming orders in the third quarter rose by 19% to 58,500 (9M 2019: 49,200) vehicles.
The liquidity reserves available to the TRATON GROUP as of September 30 include cash funds of €2.2 billion as well as credit lines of €7.7 billion. TRATON SE entered into its first revolving credit line of €3.75 billion in the third quarter and will use it as a liquidity reserve for the Group and to replace part of the bilateral credit lines. As a result, TRATON is increasing its flexibility as regards financing.