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Navistar International Corp. announced their merger with Munich-based Traton Group in a transaction valued at $ 3.7 billion, completing a strategic alliance launched in 2017.

Traton now has a solid foothold in the United States, which is considered the largest source of income for the trucking industry.

Traton holds all of the shares in Navistar, which Traton (formerly Volkswagen Truck & Bus AG), a subsidiary of the Volkswagen Group, claims to be delisting and deregistered with the US Securities and Exchange Commission this month.

Navistar Photo Gallery

Check out some of Navistar’s trucks and products.

An LT series truck. (Navistar International Corp.)

“Today is a sensational day for the Traton Group and for our new colleagues at Navistar who join the global Traton family,” said Traton CEO Matthias Gründler in a press release. “From that day on, we will work side by side to bring the sustainable transport of the future one step closer. The whole group is looking forward to it. “

Traton brands include MAN, Scania, Volkswagen Caminhões e Ônibus and RIO. In 2020 Traton sold around 190,200 vehicles. The product range includes light commercial vehicles, commercial vehicles and buses, which are produced at 29 locations in 17 countries. For the period ended March 31, the company had a record 81,700 quarterly orders, 51% more than last year, and was increased largely by truck orders of 78,700.

Navistar manufactures the international brand of commercial vehicles in classes 4-8. According to WardsAuto.com, a total of 50,817 trucks were sold in 2020 – 23,270 of which were in Class 8. That was less than Navistar’s total 2019 sales of 78,091, of which 37,809 were heavy trucks, Wards reported.

Gründler noted the smooth and fast “impressive work on both sides of the Atlantic” to drive the merger forward despite the obstacles posed by the COVID-19 pandemic.

Navistar CEO Persio Lisboa said Navistar is ready for the next steps in the collaboration.

“Navistar and the Traton brands have worked very well together over the past five years and it is exciting to be part of the global Traton Group,” said Lisboa. “The transport industry is changing rapidly. And together we will shape this change in the interests of our customers. “

One of these next steps for Traton will increasingly focus on the Chinese market, which, according to Traton, accounts for 40% of sales of trucks over six tons.

“Chinese fleet customers are increasingly looking for higher quality vehicles. They expect more and more in terms of efficiency and safety. We want to meet this demand ”, said Gründler at the annual meeting of Traton on June 30th.

International HX

Navistar’s next generation heavy-duty HX International Truck is primarily aimed at the construction, timber, mining, and oil and gas sectors. (Navistar Inc.)

“We want to create new business models and partnerships that create added value. We are broadening our view of logistics and digitization, ”said Gründler.

Gründler also emphasized that all of his brands have a clear return target. “That means making our brands even stronger.”

Navistar’s net income for the second quarter ended April 30 was $ 163 million, or $ 1.63 per diluted share, compared to a net loss of $ 38 million, a loss of 38 cents a year earlier .

Revenue rose to $ 2.1 billion from $ 1.9 billion a year earlier.

Although analysts largely praised the takeover, Bloomberg News reported that Traton has struggled in the past to integrate industrial operations after taking full control.

Bloomberg pointed to rivalries that had hampered the Scania-MAN collaboration for years, and Traton initiated a profound restructuring at MAN after cost-sharing projects with Scania failed to stop the dramatic deterioration in earnings.

At the same time, Traton has taken steps to expand its presence in Asia. It cooperates with the truck subsidiary Hino of Toyota Motor Corp. when shopping as well as battery-electric and fuel cell trucks. Traton’s Swedish brand Scania announced in November that it would build a wholly-owned manufacturing facility in China to manufacture trucks early next year, Bloomberg reported.

Traton has now developed a joint 13-liter base engine that it will first install in Scania vehicles in Europe. It will then be rolled out to other brands so that by 2025 every second heavy truck from the Traton brands will be powered by the CBE.

Looking ahead, so Gründler, the future will clearly be shaped by battery-electric commercial vehicles. “The CBE is the last conventional drive that was developed by the Traton family and their brands,” says Gründler.

Navistar is expanding its engine facility in Alabama to accommodate the next generation of big-bore diesel powertrains that Traton helped develop.

It is building a new truck plant in San Antonio that will manufacture Class 6-8 trucks.

Both Traton and Navistar have separately acquired minority stakes in the technology provider TuSimple for self-driving trucks.

In July 2020, Navistar announced a strategic partnership with TuSimple to help develop self-driving SAE level 4 trucks with the goal of production by 2024. It was a step-one expert described as a milestone in terms of the interactions between OEMs and startups. In addition, Navistar has taken an undisclosed minority stake in TuSimple.

“For automated trucking to scale, startups need to rely on OEMs to produce Class 8 tractors that are optimized for driverless operation in terms of redundancy, performance, cooling and more,” said Richard Bishop, head of the Strategy and partnerships for automated vehicles at Bishop Consulting. “The redundancy of safety-critical components such as brakes and steering is particularly important for a robust proof of safety. Startups and OEMs have been discussing this for a number of years, and the TuSimple Navistar partnership is the first to be publicly announced. This is a significant step forward for the industry. “

TuSimple

TuSimple’s self-driving technology is being tested on Scania S500 trucks in Sweden in collaboration with the Traton Group. (TuSimple)

Earlier this year, TuSimple reported that it had received 6,775 orders for a new line of purpose-built autonomous trucks in the SAE Level 4 International LT Series. Penske Truck Leasing, Schneider and US Xpress were among the first customers to make reservations.

Schneider ranks 7th on Transport Topics’ Top 100 list of the largest rental carriers in North America. Penske Logistics ranks 14th, US Xpress ranks 21st.

In September, Traton reported that it will apply TuSimple’s Level 4 technology to heavy Scania trucks traveling on a hub-to-hub route in Sweden between Södertälje and Jönköping – a distance of around 200 miles one way .

“The triad of people, planet and performance will shape the future of our company,” says the press release on the merger.

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