The News-Sun reported last year that the industry as a whole was building more commercial trucks than were being sold. The surplus in trucks in the commercial sector, have caused companies like Navistar to reduce line production speed at plants in the United States and Mexico.
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“In order to realign production with the current demand for our products, we will be adjusting line rates at our Springfield Assembly plant. This action is normal due to the cyclical nature of our business,” said Navistar spokesperson Lyndi McMillan in an email to the News-Sun earlier this year.
Navistar reduced the number of trucks built at its Springfield plant in September and then again earlier this year. As of February the facility builds 70 trucks per day on its main line, down from 97 reported towards the end of 2019.
Multiple layoffs occurred at the plant as a result of the changes and at least 354 workers have been laid off there since September, according to Chris Blizard, the president of UAW Local 402. His union represents assembly production workers and those with skilled trades at the Springfield plant.
The company reported an overall net income of $221 million for the last fiscal year and revenues of $11.25 billion. However its leadership estimates a dip in revenues for 2020 as it is expected to be between $9.25 billion and $9.75 billion.
Navistar reported a net income of $11 million and revenues of $2.4 billion during the first quarter of 2019. In comparison, this year’s first quarter revenues were $1.8 billion.
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"While revenues are down year-over-year, these results are in line with the guidance we provided in December as the industry works through a transition period," said Troy Clarke, the chairman, president and CEO of Navistar. "Throughout the quarter, we implemented actions to lower costs, yet the results were impacted by lower volumes."
Navistar currently projects the total number of retail deliveries in 2020 for medium-duty trucks and buses in the United States and Canada to be between 335,000 to 365,000 units. Heavy duty truck deliveries are expected to be between 210,000 and 240,000 as well.
During the latest quarter for the company, it received final approval of the MaxxForce exhaust gas recirculation engine legal settlement. The company funded $85 million last month, relating to the cash portion of the settlement, company officials said in a news-release this week.
Earlier this year, Volkswagen’s commercial truck unit, Traton, offered to buy the remaining shares of Navistar for $2.9 billion. Navistar’s board of directors is currently reviewing the proposal.
The Springfield News-Sun will continue to provide unmatched coverage of Clark County’s top employers, including Navistar. The paper has provided extensive coverage of current production levels as well as layoffs at the company’s Springfield plant.
By the numbers:
$36 million: Net loss reported during the first quarter of fiscal year 2020
$1.8 billion: Revenues during the quarter
$11 million: Net income reported during the first quarter of last year
$2.4 billion: Revenues during the first quarter of last year
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