German truck maker MAN SE posted first-quarter operating profit of around 250 million euros ($332.5 million) – down 22.9 percent from the prior year, due to the strong competition in several markets.
“We currently perceive strong pressure on margins, especially in stagnating markets that we have to and will counter with measures to boost profitability and efficiency,” Chief Executive Officer Georg Pachta-Reyhofen said in a speech to be delivered at the company’s annual general meeting in Munich.
The company confirmed its 2012 forecasts, which include declining sales and returns. “Return on sales is likely to remain at the average long-term target of 8.5%,” Pachta-Reyhofen said. In 2011, one of the most successful years for the company, its return on sales was 9%.
Industry-wide European truck sales have tumbled this year as central bankers in countries using the euro predict a recession for the region.
Deliveries of heavy trucks dropped 9.2 percent in February, according to the European Automobile Manufacturers’ Association ().
MAN, which is partnering with its largest shareholder and German automaker Volkswagen AG (VLW.L, VLKAY.PK) and Swedish trucks and buses maker Scania AB (SVKBF.PK), said the joint projects within the Volkswagen Group will also have a beneficial impact.
Volkswagen may further increase its majority stake in truck maker MAN SE to 75 percent or more, said Jochem Heizmann, the car maker’s executive board member responsible for truck operations.
The company is seeking to integrate MAN more closely with Swedish rival Scania (SCVb.ST), which the Wolfsburg-based company also controls, to save at least 200 million euros (165.85 million pounds) annually in procurement, production and research and development.