- Company name
- PACCAR
- Sector
- Heavy trucks
- About
- PACCAR designs, makes and sells heavy and medium trucks under the Kenworth, Peterbilt and DAF brands. Kenworth and Peterbilt sell mainly in the United States, Canada, Mexico and Australia, and DAF sells mainly in Europe and South America. The company has three segments: Truck, Parts and Financial Services. PACCAR Parts sells aftermarket parts through more than 2,000 dealer locations and more than 350 TRP stores, and it earns more stable profits than the truck business. PACCAR Financial Services gives loans and leases to dealers and customers, and it includes the PacLease truck leasing business. Revenue was $28.44 billion in 2025, and net income was $2.38 billion. PACCAR makes its trucks for the United States, Canada and Mexico in factories in those countries.
- Thesis
- The market prices PACCAR for a weak North American truck market and for uncertain emissions rules. PACCAR delivered 39,800 trucks in the United States and Canada in the first half of 2026, down from 45,200 a year earlier. Customers delayed truck purchases while the US Environmental Protection Agency (EPA) reviewed the 2027 NOx emissions rules and while freight rates were low. In Q3 2026, demand started to recover. US and Canada deliveries rose to 23,800 trucks from 17,100 a year earlier, and Truck segment pre-tax profit rose to $455 million from $103 million. PACCAR now estimates US and Canada Class 8 retail sales of 240,000 to 260,000 trucks in 2026 and 240,000 to 280,000 trucks in 2027. For the gap to close, four things must be true. Retail sales in 2027 must reach at least the low end of the company's range, as customers replace old trucks. Truck margins must stay near the Q3 2026 level, helped by higher prices and lower tariff costs. Parts revenue must keep growing, as it did in Q3 2026. The EPA's final 2027 NOx rule must also not add large new costs. The Q4 2026 report in late January 2027 gives the next test. If these checks pass, the gap can close over the next three to five quarters. The main reason it may not close is a weak freight market that delays the replacement of old trucks.
- Risks
- Truck sales are cyclical. US and Canada deliveries fell 12% in the first half of 2026 and recovered only in Q3 2026. If freight rates stay low, customers can delay truck purchases into 2027 and later, and Truck segment profit falls.
The EPA's final 2027 NOx rule is not yet published. A final rule with higher costs, or more delays, can change when customers buy trucks and can increase PACCAR's engine and warranty costs.
Tariff policy can change. PACCAR builds most trucks locally, but tariffs on steel, aluminum and parts, or new rules under Section 232, can increase its costs.
PACCAR Financial Services had a provision for losses on receivables of $112.1 million in the first nine months of 2026, up from $84.0 million a year earlier. Lower used truck prices or more customer defaults can reduce its profit.
- Balance sheet
- Cash: $9.2B
Debt: $14.7B
Net debt: $5.5B
Undrawn credit line: $4.0B
PACCAR keeps two parts of its balance sheet apart. The Truck, Parts and Other businesses had cash and marketable securities of $9.24 billion at September 30, 2026, and no debt. All debt is in PACCAR Financial Services, which lends to dealers and customers. At September 30, 2026, Financial Services had assets of $22.48 billion and liabilities of $16.56 billion, which include its debt. The Q3 2026 release does not give the debt alone, and the Q3 10-Q is not yet filed, so the debt figure is the latest one, $14.70 billion at June 30, 2026. Loans and leases back this debt, so it is not comparable to the debt of an industrial company, and the figures leave out EBITDA and interest cover for this reason. In the first nine months of 2026, PACCAR Financial Services issued $2.38 billion of medium-term notes. PACCAR has $4.00 billion of committed bank facilities: $1.50 billion expires in May 2027, $1.25 billion in June 2029 and $1.25 billion in June 2031. PACCAR says that its credit ratings are A+ and A1.
As of Sep 30, 2026.
- Checkpoints
- Oct 27, 2026: Q3 2026 earnings: deliveries and truck margins. Passed. Watch: Higher deliveries than the 38,700 trucks of Q2 2026 and a higher Truck segment margin pass; lower deliveries or a lower margin fail. Outcome: Deliveries rose to 40,100 trucks and Truck segment pre-tax profit rose to $455 million, about 8% of Truck revenue, from $361 million in Q2 2026.
Jan 27, 2027 (estimate): Q4 2026 earnings: 2027 market outlook. Pending. Watch: A 2027 outlook for US and Canada Class 8 retail sales that keeps at least the low end of 240,000 trucks and a Truck segment margin near the Q3 2026 level pass; a lower outlook or a lower margin fails.
- Recent events
- Oct 27, 2026: PACCAR reported Q3 2026 results. Revenue rose 19% to $7.94 billion, and net income rose 44% to $847.5 million, or $1.61 per diluted share. Deliveries were 40,100 trucks, with 23,800 in the United States and Canada. Truck segment pre-tax profit rose to $455 million from $103 million a year earlier. PACCAR Parts had record revenue of $1.78 billion. PACCAR estimates US and Canada Class 8 retail sales of 240,000 to 260,000 trucks in 2026 and 240,000 to 280,000 trucks in 2027.
Jul 28, 2026: PACCAR reported Q2 2026 results. Revenue was $7.55 billion and net income was $752 million, or $1.43 per diluted share, up 24% from Q1 2026. Deliveries were 38,700 trucks. PACCAR Parts had record revenue of $1.75 billion and pre-tax income of $417 million. Truck segment pre-tax income rose to $361 million from $309 million a year earlier, because of higher prices and lower tariff costs.
Jul 28, 2026: PACCAR said that the EPA's clarification of the emissions rules on July 9, 2026 helps customers make purchase decisions for the second half of 2026 and 2027. The EPA's proposed rule keeps the 2027 NOx limits and changes the warranty and useful life requirements.
Apr 28, 2026: PACCAR reported Q1 2026 results. Revenue was $6.77 billion and net income was $605 million. US and Canada deliveries were lower than a year earlier because of low retail demand.
Feb 20, 2026: The US Supreme Court ruled that the tariffs imposed under the International Emergency Economic Powers Act were invalid. PACCAR says that the decision gave it tariff relief and the recovery of some amounts it had paid. The Section 232 truck tariffs that began in November 2025 are separate, and PACCAR says its local factories limit their cost.
Jan 27, 2026: PACCAR reported 2025 results. Revenue was $28.44 billion and net income was $2.38 billion, or $4.51 per diluted share. Adjusted net income, which excludes a $264.5 million after-tax charge for civil claims in Europe, was $2.64 billion, or $5.01 per share. PACCAR declared dividends of $2.72 per share for 2025.