Scania reported better than expected order bookings in the third quarter, as Brazil helped the company make up for the loss in Europe.
Analysts predicted truckmaker Scania will report a 14% fall in bookings, but the automaker reported a 10% decrease in trucks and bus bookings in the third quarter. Although demand for heavy-duty commercial vehicles has also been affected by the European crisis, Scania managed to keep its sales up thanks to Brazil, where the government has offered subsidies to encourage and boost sales of new, greener trucks.
Truck industry in Europe, Scania’s biggest market, showed a moderate decline through July and August, but September brought a small increase in demand after a summer lull. For Scania and rival MAN SE, September has continued the low level in many markets, as the first months of the quarter.
“The short-term outlook is very difficult to judge and imposes stricter demands for volume flexibility and cost control,” the company said.
Scania, has been long envied for its profitability by heavyweights Daimler and Volvo, but this month it announced its operating margin saw a decrease of 10.5%, close to the 10.6% predicted by analysts. Scania’s operating profit fell to $286 million compared with almost $350 million last year.