Navistar Loses $247 Million in 3Q

September 4, 2013

In the third quarter of 2013, Navistar reported a net loss of $247 million compared to the company’s third quarter 2012 income of $84 million. The company reported a continuing operations loss of $237 million, compared to the third quarter 2012 continuing operations income of $80 million.

Total revenue in the quarter was $2.9 billion, down 12 percent from 2012. Navistar finished the third quarter 2013 with $1.09 billion in manufacturing cash and marketable securities.

The company’s truck and engine segments reported losses of $58 million and $86 million, respectively. The parts segment reported a profit of $76 million despite a 9 percent decline in net sales year-over-year.

Navistar attributes the year-over-year decline to overall industry conditions, as well as the company’s transition to SCR-based products and the resulting lower volumes in its North American truck business.

The decline was partially offset by stronger volumes in the South American engine business. A $36 million reduction in engineering and product development costs and $14 million in lower selling, general and administrative expenses also offset the year-over-year decline.

"We were pleased with our strong cash performance in the quarter. We also continued to make solid progress on key elements of our Drive to Deliver turnaround plan, especially the on-time launches of our new Class 8 product offerings, which drove Navistar's order share up to more than 20 percent in the quarter, compared to 12 percent in the second quarter. We're encouraged by the growing customer acceptance of our new products," said Troy A. Clarke, Navistar's president and CEO. "At the same time, we clearly need to accelerate progress with our financial results, and we are already implementing additional cost reduction and business improvement actions to counter our near-term volume challenges. This includes resizing our company to match our current business environment."