Daimler Truck Financial Services originations drop 13.5%

The financing arm of German commercial vehicle manufacturer Daimler Truck saw originations slide in the third quarter as North American truck sales plummeted. 

Still, Daimler Truck Financial Services reported increased revenue in Q3 due to stronger portfolio margins as well as lower selling, general and administrative costs (SG&A), Chief Financial Officer Eva Scherer said during today’s earnings call. 

“These gains more than offset [foreign exchange] headwinds and elevated cost of risk, which remained driven by the ongoing freight recession and macroeconomic uncertainty in North America,” she said. 

The captive financing company reported in Q3: 

• Revenue rose 3% year over year to 856 million euros ($990.6 million); 
• New business volume dropped 13.5% YoY to $2.8 billion; and 
• Total outstandings, or contract volume, dipped 1.8% YoY to $33.6 billion. 

Meanwhile, Daimler Truck Group and Daimler Truck North America (DTNA) reported in Q3: 

• Group revenue totaled $12.3 billion, down 13.9% YoY; 
• Group unit sales dropped 14.7% YoY to 98,009; 
• Group incoming orders fell 0.8% YoY to 93,923; 
• DTNA revenue decreased 33.4% YoY to $4.6 billion; 
• DTNA unit sales plunged 38.7% YoY to 30,225; and 
• DTNA incoming orders fell 28.9% YoY to 26,168. 

The steep drop in North American sales came amid “ongoing economic uncertainty and a weak U.S. freight market,” Scherer said.  

“Considering tariff uncertainties, our effort to accelerate deliveries in quarter two ahead of potential tariff changes amplified the sequential decline in unit sales,” she said. 

For Q4, Daimler anticipates North American unit sales “roughly in line with third quarter levels, but profitability to be sequentially weaker due to an ongoing unfavorable mix, a fading pricing tailwind, increased tariff costs and seasonally higher [research and development] and SG&A expenses,” she said. 

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