VW eyes Navistar takeover

Truck & Bus finance boss spurs talk of a takeover down the track

VW eyes Navistar takeover
Matthias Gründler says a takeover makes sense


Volkswagen Truck & Bus has talked up its achievements and direction ahead of its medium-term stockmarket listing but it is the future of its minority holding in Navistar that has tongues wagging.

Navistar shares jumped nearly 10 per cent yesterday after Volkswagen Truck & Bus CFO Matthias Gründler reportedly told German reporters at a financial results event that a full takeover "would make sense at some point".

VW picked up more than 16 per cent of Navistar in September 2016 before cementing cooperation on future technology a year later, after it was formalised.

At the press event, VW made plain it will continue to push its Global Champion strategy into new markets, noting its market share in Germany was 35 per cent, in Europe closer to a third and40 per cent  in Brazil.

"To do so, the company also capitalizes on strategic partnerships in growth markets: With Navistar in North America, Sinotruk in China and most recently Hino Motors in Japan and Asia.

"Via Navistar, Volkswagen Truck & Bus gained direct access to NAFTA, the largest commercial vehicle market in the world.

"Since establishing the strategic alliance in 2017, both companies have stepped up their cooperation in joint engine and drive technologies.

"In procurement, the partners were able to realise significant synergies via a joint venture within the first year.

"In China, MAN holds a stake in Sinotruk, the country’s largest manufacturer of heavy trucks. In 2017, it recorded a strong increase in revenues of 68 per cent to 55.5 billion RMB.

"To further strengthen its position in Asia, Volkswagen Truck & Bus recently entered into a strategic partnership with the Japanese company Hino Motors, one of Asia's leading truck and bus manufacturers."

Navistar is also embedded in the German giant’s digital connections umbrella RIO.

"Already today, more than 360,000 connected trucks from MAN and Scania are driving on Europe's roads," VW says.

 "Including the Navistar fleet, this will increase to 650,000 connected trucks."

On the financial front, since the foundation of Volkswagen Truck & Bus in 2015, revenues increased by more than 16.8 per cent and operating profit before special items by more than 61.5 per cent.


In the 2017 financial year, Volkswagen Truck & Bus generated revenues of €23.9 billion (A$38 billion) in the commercial vehicles business, up 12.1 per cent on the previous year.

Operating profit before special items increased 26.8 per cent to €1.7 billion, corresponding to an operating return on sales of 6.9 per cent.

All Group brands contributed equally to this positive development of Volkswagen Truck & Bus.

MAN Truck & Bus’ revenues rose by 8.6% to €10 billion, while operating profit saw a sharp rise of 27.9 per cent to €532 million.

Scania achieved impressive growth of 13.2 per cent with revenues of €12.8 billion.

Operating profit grew even stronger to €1.3 billion.

Volkswagen Caminhões e Ônibus increased revenues by 32.5 per cent to €1.1 billion after an extremely weak economic year 2016.

Although the operating result remained negative due to continued weak demand and strong competition, revenues growth and efficiency programs led to a decline in the loss to €105 million.

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