MAN’s second-quarter profit dropped 67% due to sluggish demand for trucks in Europe and extra costs for a plant project.
MAN’s operating profit dropped to 72 million euro from 219 million euro in 2012, while revenue increased 3.6% to 3.99 billion euro and orders were up 0.6%.
“For the time being, the environment remains difficult,” Chief Executive Officer Georg Pachta-Reyhofen said in the statement. “Much will depend on how quickly the global economy recovers from the uncertainties triggered by the euro crisis.”
MAN, which is Europe’s third-largest maker of commercial vehicles, reduced production as companies have avoided making vehicle purchases in the recession hit European market. The company has also cut costs, reduced work shifts and streamlined procurement, all measures aimed at protecting earnings.
New truck registrations fell 11.5% in Europe during the first half of the year to 132,900 units, according to ACEA. MAN expects revenue this year to be at the same level with last year’s and a big decline in operating profit.
“MAN didn’t say it expects business to pick up in the second half of the year,” in contrast to competitors including Daimler and Volvo, said Sascha Gommel, a Frankfurt-based analyst at Commerzbank AG.