As a result of a softening Class 8 truck market Navistar posted a fourth quarter loss of US$34 million on softer revenues. Charge-outs were down 18% compared to Q4 2015, Navistar announced. Revenue was down 17% year-over-year in the fourth quarter.
“In the fourth quarter and throughout the full year, we’ve demonstrated our ability to lower our break-even point and improve our operations,” said Troy A. Clarke, Navistar president and chief executive officer. “We recorded our fourth consecutive year of adjusted EBITDA improvement and significantly improved our adjusted EBITDA margin year on year, despite a substantial decline in revenues primarily due to the challenging conditions in the Class 8 market.”
It was an eventful quarter for Navistar. It launched its new LT flagship Class 8 highway tractor and also announced a new strategic partnership with Volkswagen. The Volkswagen deal is expected to close in the first quarter of 2017.
For the full year, Navistar reported a net loss of US$97 million.
“Although we expect tough industry conditions to continue through the first half of 2017, we see further opportunities to continue to reduce our break-even point, including leveraging some early cost synergies from the Volkswagen Truck & Bus alliance,” Clarke said. “The alliance announcement has been positively received by our customers, which when combined with our ongoing cadence of new product offerings, confirms our confidence in our improving standing in the market.”
Navistar is projecting Classes 6-8 truck and bus retail deliveries to total 305,000-335,000 units in Canada and the US in 2017.