Engine acceptance gives PACCAR heavy-duty boost

CHICAGO, (July 24, 2003) — Paccar Inc., the parent company of Kenworth Truck and Peterbilit Motors, announced today its quarterly earnings rose as orders for heavy-duty trucks picked up.

Paccar said second-quarter net income rose to $124.1 million, or $1.06 a share, from $73.7 million, or 63 cents a share. Sales rose to $2.0 billion from $1.8 billion.

Demand for heavy-duty trucks, which collapsed two years ago due to the weak economy and a glut of vehicles, has recently shown signs of a rebound, with freight tonnage hauled by carriers trending upward. The company says industry-wide orders rose almost 10 per cent in North America over the first quarter, when during that time orders fell 32 per cent.

Paccar said another reason for the rise in earnings is due to truckers slowly becoming more comfortable with new engine technology introduced last fall to meet stricter Environmental Protection Agency regulations. Demand for new trucks dived late last year as buyers held off on purchases and sat on existing equipment until they had a chance to test the new engines.