Uncertainty Has Frozen the Consumer, Says Daimler Truck North America CEO

Market Uncertainty & Impact - Customers are in a "wait and see" mode due to uncertainty in freight rates and economic policies, impacting truck sales [2] - A 20% drop in unit sales was observed in the second quarter, with uncertainty expected to continue affecting revenue in Q3 [3] - The need for firm economic policy is emphasized to alleviate uncertainty and allow businesses to adjust and move forward [6] Production & Supply Chain - The company is the nation's largest school bus producer with significant production in the US and some plants in Mexico [7] - The company has flexibility to build models in either the US or Mexico [9] - The automotive industry's integrated supply chain between Canada, Mexico, and the U S poses challenges for quick adaptation [11] - Bringing a new plant online or refurbishing an old one to modern standards could take up to three years [12] Tariffs & USMCA - Tariffs on trucks assembled in Mexico apply only to non-US produced parts; for example, a truck with 40% non-US parts faces a 10% tariff [13] - The company is currently USMCA compliant, requiring roughly 65% U S content for Mexican trucks [14] - Inflationary pressure from tariffs exists, but the ability to pass costs to customers is limited by competitive pressures [15] Investment Strategy - Stock buybacks have been a consistent strategy since becoming a separate company in 2021, independent of current market conditions [18] - Investments are primarily driven by environmental regulations, such as fuel efficiency and CO2 emission standards [19][20]