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CTW.1122. PACCAR

Medium- and heavy-duty trucks are vital to the global economy, but they threaten the global climate: They account for 25% of all automobile-based CO2 emissions, even though they make up just 10% of the vehicles on the road. Paccar, which owns top-selling heavy truck brands including Peterbilt, Kenworth, and DAF, is doing its part to green the trucking fleet. Paccar’s first EVs hit the market in 2021, and it now sells a total of seven battery-electric models worldwide. Semis in general cost anywhere from $100,000 to over $500,000, and Paccar estimates it will deliver hundreds of electric trucks this year; the company, based in Bellevue, Wash., expects more than half of its production to be zero-emissions vehicles by 2035. Paccar’s brands have also been refuting the stereotype that electric haulers can’t tackle steep hills: Earlier this year, the DAF CF Electric truck became the first battery-electric heavy truck to tame Austria’s highest mountain pass, on the Grossglockner High Alpine Road.

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Paccar is a light-, medium-, and heavy-duty truck manufacturer that also provides technical and financial services support for its products.

For an astounding 13th straight year, Apple claims the top spot in Fortune’s annual ranking of corporate reputation, based on a survey of almost 3,800 executives, directors, and analysts.

This year's Fortune Global 500 generated $33.3 trillion in revenues and $2.1 trillion in profits.

G500-2020-497-Paccar

The company manufactures light, medium, and heavy duty trucks under the brand names Peterbilt, Kenworth, and DAF.

This year's Fortune 500 marks the 66th running of the list.

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This year's Fortune 500 marks the 65th running of the list.

Here are the World's Most Admired Companies for 2018 as ranked in their industries. See who made the list.

This year's Fortune 500 marks the 64th running of the list.

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This year's Fortune 500 marks the 63rd running of the list.

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Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

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Paccar (PCAR): Company Profile, Stock Price, News, Rankings

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Paccar

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Good morning, and welcome to Paccar's third quarter 2026 earnings conference call. All lines will be in a listen-only mode until the question and answer session. Today's call is being recorded, and if anyone has an objection, they should disconnect at this time. I would now like to introduce Mr. Ken Hastings, Paccar's Director of Investor Relations. Mr. Hastings, please go ahead.

Thank you, Joel, and good morning, everyone. My name is Ken Hastings, Paccar's Director of Investor Relations. Joining me this morning are Preston Feight, Chief Executive Officer, Kevin Baney, President, and Brice Poplawski, Senior Vice President and Chief Financial Officer. As with prior conference calls, we ask that any members of the media on the line participate in a listen-only mode. Certain information presented today will be forward-looking and involve risks and uncertainties that may affect expected results. For additional information, please see our SEC filings and the investor relations page of Paccar.com. I would now like to introduce Preston Feight.

Hey, thank you, Ken, and good morning, everyone. Kevin, Brice, Ken, and I will update you on Paccar's excellent third quarter financial results and business highlights. I'd like to start by thanking our wonderful employees all around the world who did a fantastic job of providing our customers with the highest quality trucks and transportation solutions in the industry. Paccar delivered excellent revenues of $7.94 billion and net income of $847.5 million in the third quarter. This is 19% revenue growth and 44% profit growth compared to the same period last year. Paccar Parts had record quarterly revenues of $1.78 billion, and Paccar Financial Services, $138 million in profit, was an increase of 9.4% compared to the same period last year.

We estimate this year's U.S. and Canadian Class 8 market to be in a range of 240,000-260,000 trucks, and next year to grow and be in a range of 240,000-280,000. The U.S. and Canadian truck market is being driven by economic growth, continued investments in infrastructure, and the general freight market recovery. In Europe, we project this year's above-16 ton market to be in a range of 300,000-320,000 units, and in a similar range for 2027. This represents continued truck replacement in a region with steady economic growth. We estimate this year's South American above-16 ton truck market to be in the range of 100,000-105,000 vehicles, and next year to be up slightly and in the range of 105,000-115,000 trucks. Paccar's premium trucks are performing very well for customers throughout all of Latin America.

Based on strong customer orders, Paccar increased deliveries to 40,100 trucks in the third quarter. Delivery volume will increase in the fourth quarter as suppliers become more able to ramp up their production to meet continued strong customer demand. Fourth quarter deliveries are anticipated to increase and be in the range of 41,000-43,000. Paccar's third quarter trucks, parts, and other gross margins were a strong 14.5%. Fourth quarter gross margins should remain high and again be in the range of 14%-15%. We look forward to a strong finish to this year and another very good year in 2027 as our customers benefit from Paccar's excellent trucks and new transportation solutions. Kevin Baney will now provide an update on Paccar Parts, Financial Services, and other business highlights.

Thank you, Preston. Paccar Parts achieved record third quarter revenue of $1.78 billion. This record is a result of investments in parts distribution, growth of the TRP all makes brand, expanding transportation solutions, and increasing dealer retail locations. We anticipate continued growth in the fourth quarter. Paccar Financial Services pre-tax income was a robust $138 million with 9.4% year-over-year growth. These excellent results reflect stable finance margins and higher used truck pricing. Similar to Paccar Parts, Paccar Financial provides steady foundational profitability during all phases of the business cycle. Last week at the American Trucking Associations' Truck Conference, Paccar proudly introduced its next generation transportation solutions platform called PACCAR Connect. This system provides a state-of-the-art technology platform and a beautifully integrated vehicle display.

PACCAR Connect has the ability to bring together fleet telematics systems, Paccar truck data, customer-specific productivity applications, Apple CarPlay, and electronic driver logs into a fully integrated system. This system will serve as a unifying platform that will enhance customer productivity and create new revenue streams for Paccar. This year's capital expenditures are projected to be between $650 million and $700 million, and research and development expenses will be $440 million-$460 million. In 2027, we estimate the company will invest $650 million-$700 million in capital projects and $460 million-$500 million in research and development expenses. Key technology and innovation investments include next generation clean diesel, hybrid and battery electric powertrains, growing the parts business, enhancing manufacturing capabilities, and expanding the connected vehicle offerings. Paccar's industry-leading trucks, best-in-class parts and financial services businesses, and advanced technology strategy position the company for an excellent future.

We will now begin the question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question is from Steve Volkmann with Jefferies. Your line is now open. Please go ahead

A couple of quick ones here from me, and I will pass it on. One, Preston Feight, I think you mentioned that you expected supply chain to kind of catch up, and I think your deliveries this quarter might have been slightly less than what you had projected. Are you seeing supply chain constraints that are limiting that, or was that just kind of normal variability?

Yeah, Steve, that's a nice observation. Our deliveries in the third quarter, 40,100, were somewhat affected by supply constraints. As we and others are building more trucks, I think the suppliers are trying to get up to speed on that. That's kind of what affected Q3 and what we think is improving in Q4 with the guide to 41,000-43,000 trucks. We're working closely with our suppliers to make sure they get the parts to us so we can build trucks. Makes it a lot easier to build the trucks when we got the parts.

Okay, that makes sense. The second one, I'm curious how you're sort of thinking about or how you're even interacting with customers relative to 2027 now. Because I'm imagining, but please correct me if I'm wrong, that it's actually hard to sort of price trucks for 2027 when we don't know the NCPs yet. That probably makes it hard to take orders. Are you taking orders for 2027? If so, can you provide any color as to sort of what people are actually ordering relative to engines?

Hey, Steve, that's great. We made the observation of it's easier to build trucks if you've got parts, and it's easier to price trucks if you know the cost. I think that the government's doing a very nice job, actually, of looking at the 2027 emissions regulations and figuring out how they are able to set the NCP levels. As you noted, they're not finalized yet, and I think that does give some customers pause about what their price will be. So we've had excellent discussions with our customers. We've known them for many years, and ATA was a great opportunity to sit with a lot of them and talk about what their needs are for 2027.

I think everyone we met with feels like they would like to keep buying the 200 milligram engines so they have time to prove out the technology of the new engines, the lower NOx engines. I think they are starting to place their orders. We're seeing good inquiry and increasing order intake, but obviously that'll likely increase as we have certainty around NCPs.

Your next question is from Jerry Revich with Wells Fargo. Your line is now open. Please go ahead.

Yes. Hi. Good morning. Good afternoon, everyone. I am wondering if you could just talk about the lead indicators that you are tracking for the Paccar Parts business. What do you expect the outlook to be over the next couple of quarters? Normally, you folks have some visibility a couple of quarters out, given contract rates are moving higher. I am wondering if you could just give an update on how you are thinking about the cadence.

Yeah, Jerry, this is Kevin. As we look at the Paccar Parts business, right now in a smaller parts market, team has done a great job increasing volume, growing share. Share is one of those things that we measure, and right now with customers have elevated operating costs. They have got higher diesel prices. They have got an increased number of unseated trucks, and so they are focused on really required maintenance at this point, and so we spend a lot of time working with them. One of our key things we look at is our share of wallet with our customers, and we have been able to grow share and increase while they are at elevated cost. As things return to more normal conditions for them, we anticipate to keep growing.

When do you think that will be, based on what you are hearing? Do you expect acceleration exiting the fourth quarter? Is it possible to get a sense, Kevin?

Yeah. We anticipate continued growth into fourth quarter, and we have been able to grow share, so that is a key metric for us. I think we really provide ease of doing business with our customers, so we continue to grow the revenue with them, gain share, and anticipate that to continue.

Super. Can I ask the margin outlook 14%-15% for the fourth quarter? What we are hearing is really good pricing for fourth quarter delivery slots and a sequential improvement from third quarter pricing. Does the margin outlook embed some of the uncertainty on the parts side versus improved profit per unit on the truck side? Or can we just unpack the push and the pull there, if you don't mind?

Yeah, sure. I think a simpler way to think about it is when we are building trucks and we have to deliver or build them without all the parts, there is a cost adder in that. So it has some impact to price cost in the quarter as we think it might occur. Obviously, we are doing everything we can to minimize that.

I think the Paccar Parts team is, as Kevin Baney said, doing a great job of getting the market share gains and margin growth. So we feel positive about how they are doing. Then I think as we look at our pricing power, it has been good with our customers. There is a strong demand for the 200 milligram engines, which we think carries into 2027 as well. So it feels pretty positive from that standpoint. It is really just about those efficiencies that we have to deal with in the fourth quarter.

I think the other part of it is, it's always a function of there's a lag factor between pricing a truck and your backlog, so that fits into the factors as well.

Yeah. Great. Good talking to you, Jerry Revich.

Your next question is from Tami Zakaria with JPMorgan. Your line is now open. Please go ahead.

Hey, good afternoon. Thank you so much. I'll ask one question today. I heard you comment about some delays in how customers are trying to or there's delays in how they're trying to decide what to order next year. As you are part of this discussion, are you getting a sense that customers are looking to buy the non-compliant engines and planning to pay a penalty on it? Or is there willingness to adopt a compliant platform even if it comes with a higher cost? Any color on which you guys and customers are leaning towards at the moment?

Sure. I think, one of the things I'd start with, Tami Zakaria, is say that we have very good visibility right now. Obviously, the year is full and we're filling the first quarter, so that's a pretty positive position to begin with. I think the customers are beginning to order, but it's just the beginning of that when they would expect the fleets to be thinking about their capital allocations for next year. That's kind of a part one of your commentary. Then I would share, and we've said this a lot, is we have not met with a customer. Every customer we meet with is much more interested in proven, stable technology that they've had time to vet in their operations.

They're asking for us to deliver to them trucks with a 200 milligram and an NCP, because that makes their operations smoother compared to introducing new technology from any manufacturer that they haven't had enough time with. That's kind of where the world sits right now.

Your next question is from Rob Wertheimer with Melius Research. Your line is now open. Please go ahead.

Thank you. I think Kevin mentioned half a dozen things that could affect Paccar Parts margin, which was down a little bit year-over-year this quarter, from mix to maybe people delaying some purchases to investments. I wonder if you could just break that down. Is there any kind of price competition that's led to lower margin or is it other factors?

Rob, it's just primarily mix right now due to the elevated operating costs that we see with the customers. We've got great trucks with a lot of proprietary content. The engine business, I mentioned the PACCAR Connect. So really see as the customer's operating conditions improve, we see a nice balance of that mix back between all makes and proprietary.

Rob, I would just add on what Kevin said and echo it in different ways. Think about the way the enforcement of CDLs went in 2026, and it pulled a lot of trucks out of service. If a truck is pulled out of a service and they are sitting against the wall, if you will, then that means that there is less miles driven on some of those newer trucks. So it is just postponing parts purchases. We think that will come back, obviously, and that is kind of what Kevin said with high fuel prices being the other factor. That is just the way the market is running, and I am so pleased with what the team has been able to do in terms of growing the parts business in a market which is kind of constrained. So they have done a really nice job in that factor.

All right. Thank you. If I may sneak in another one, you mentioned a couple times the launch of PACCAR Connect and potentially even new revenue streams that might come out of it. But what are the biggest kind of pain points, whatever you want to call it, that your customers are feeling that might be solved by this, and how does that evolve over time? I will stop there. Thank you.

Yeah. Thanks, Rob. Great question. We are really excited about this. The product is really cool. I do not know if you had a chance to see it, but if you get in one of the new Peterbilt or Kenworth trucks with the integrated system, what you end up with in today's world is people install third-party telematics systems into their truck, which requires getting into the dash, cutting things, installing hardware, and this eliminates the need to do that. So step one is it gives Paccar an opportunity on a hardware side, because now we are doing that work for the customer in a much more integrated factory direct manner. So they are all going to be excited about that. We hear that from them.

Then you think they get the choice of the telematics system they want to put in as we are doing this as some kind of an open source system, kind of like you can akin it to an iOS on your phone, an operating system on your phone where you can add applications that can be bespoke to a customer, specific to a customer, or they can be Paccar applications, and those applications can be revenue accretive for Paccar. They are also really beneficial to our customers. You think about how it builds into the parts business in the future. As we understand what the truck is doing, it gives us the opportunity to do predictive maintenance on the truck or direct it towards our dealerships. So integrating our businesses with our customers in a way that is beneficial for their profitability and ours feels like just an exciting time.

Yeah. I'll just add to it. It allows us to stay connected longer with the customer through their operating cycle, and so ease of doing business around the Paccar Parts business will really help.

Your next question is from Lewis Merrick with BNP Paribas. Your line is now open. Please go ahead.

Yeah, good morning, everyone. Thank you for taking my question. Just one from my side. A quick one on tariffs. Are you able to confirm there was still some one-off benefit from tariffs during the quarter? If so, how much should we expect there to be further one-off benefit coming in 4Q? Is 1Q then the point where we sort of get to a clean sort of point from a tariff perspective?

Lewis, what we've seen is the tariffs have gotten a little more stable. We've still seen tariff costs that we incur as we're importing. We've had some benefits as well, but it's really not been material to the results of our performance. It's just kind of in the mix.

Okay. Just to be clear, there wasn't any sort of one-off benefit in 3Q?

No, it's kind of like it's just continuing as we sort through the tariff process and work with the suppliers and work with the government and try to get clarification on it.

Yeah, this is Brice. A comparable, I think we mentioned in the second quarter as well during the call, comparable kind of activity.

Your next question is from David Raso with Evercore ISI. Your line is now open. Please go ahead.

Hi, thank you for the time. You used to speak to gross margins as the third quarter guide and then further increases in the fourth quarter. Just so we are clear, the change and now the third to fourth quarter gross margins are more flattish as a base case. Is that more because the truck margins are not going to grow sequentially the way you would have thought due to the supplier-related inefficiencies? Or is it also related to the Paccar Parts margins being less than you thought? I just had a quick follow-up on truck margins more broadly.

Yeah, David, good to talk to you. I would say that your first comment is more accurate than your second comment, in that it is just the cost of production right now is having some impact. We are seeing great truck pricing, but it is just that uncertainty there.

Well, that is what I wanted to back into the second question. So the profitability per truck was the highest since the fourth quarter 2024, and you did it with 3,800 less trucks delivered, right? So it appears very impressive. You did have more U.S./Canada mix this quarter than back then. Price cost was negative back then. I am not sure if you commented if price cost was still positive this quarter like last, so maybe you can confirm that. But I think we are all just trying to level set. Maybe the supplier issue does not extend into 2027, but what do I do with the fourth quarter margin as a launchpad thinking about 2027? I know there is a lot in there with penalty revenues on the trucks in 2027 and how that dampens the margin.

But again, just trying to think through this margin performance and how to think about the fourth quarter launch for 2027 thoughts. Thank you.

Yeah. David, like usual, you give these great questions. It's fun to talk with you. You bring up a very important point is, if you think back at just a year ago in September of 2025, net income was $590 million. In this quarter, it's $847 million. So the teams have just done a fantastic job, each quarter increasing total profitability. They've done that through truck pricing and through disciplined operating performance like Paccar always does. It sets us up really well for the future, puts us in a very strong position to look forward into things. Obviously, the more stable the market is and the more clean the production costs are, the easier it gets for us. I think you asked or you mentioned, which I think was kind of an ask, about price cost, and price costs remain favorable in the quarter.

That was mostly due to, on the price side, the favorable price realization we're getting on our truck pricing.

I guess I asked the question without asking you for guidance for 2027 truck margins. Would you look at this fourth quarter then with, again, the drag of maybe pass-through revenues with not much margin on the penalty, but assuming less supplier issues? Just how would you want us to think about 2027 truck margins versus this third, fourth quarter kind of run rate?

Yeah. Great. That's a great way to think about it. If you think about 2027, we're calling the market up, and we're doing that without having the certainty of what the cost structure will be in 2027, which means we're pretty bullish. We remain our bullish position on 2027. We think that any of the uncertainty will show up in the first part of the year, and then clarity will be through the second, third, and fourth quarter. Then as we get towards the end of the year, we would expect it to even strengthen. So I think our general sense is the uncertainty will dissipate and the market will become stronger as the year passes.

Your next question is from Chad Dillard with Bernstein. Your line is now open. Please go ahead.

I want to go back to the Paccar Parts business. Can you update us on what the outlook is for 2026? I think you talked about seeing some outgrowth, and I recall from the Investor Day, you talked about the $3.5 billion parts opportunity. Just any color on just how fast you are outgrowing and where you are tracking versus that goal?

Yeah, Chad, this is Kevin. Outlook for 2026, I mentioned the continued growth in the fourth quarter, and we will finish within the range that we had forecasted, the 3%-5% we had given previously. Outlook for next year is continued growth. We see as we watch customers' operating conditions, as Preston mentioned, we forecast the market to increase. We have got the PACCAR Connect platform out there, and we see the continued growth. We mentioned in the Investor Day the opportunity with the second owner. We mentioned the parts market down. Some of the growth that we have seen with our record revenue has come from growth in the second market. We have grown with our fleet services program, and then we have also grown the percent of our TRP and all makes, and a portion of that comes from the second owner.

Gotcha. That is helpful. In your North America guidance for 2027, it implies about a 4% increase at the midpoint. I was hoping you could break down how you are thinking about the vocational versus tractor market as we go into next year.

We kind of look at the markets and think that we have really run it below replacement demand on the fleets. I think that they have had some relief from that because of the driver situation. They recognize the high performance, great fuel economy, low operating cost, and driver appeal of new trucks. I think they are very interested in getting new trucks and are starting down that pathway. I think that the general infrastructure investments that are happening in America are very good for the vocational market for the coming years. Since we are the leader in the vocational market with our 40% share there, we think that bodes well for us also, because those are good trucks for us to sell.

Your next question is from Kyle Menges with Citigroup. Your line is now open. Please go ahead.

Thanks. I just wanted to follow up on Chad's parts question. I think if I heard you correctly, you are still thinking that parts growth can be in the range of 3%-5% for the full year. I think that would imply parts growth of around high single digits in the fourth quarter versus you have been tracking in the low singles through the first nine months of this year. What gives you confidence in that high single-digit growth in the fourth quarter?

I would say we have a great team of people that are working closely with our dealers and our customers, and the freight market is returning. Those are the factors that push us into that confidence.

Yeah, Kyle, I will add that we have seen a growth in our fleet services program, so that shows that we continue to gain new customers, the ease of doing business with our parts programs. We gain new customers, and we continue to increase our share of wallet with our current customer base. We are planning for ongoing growth.

Got it. Thanks. I also wanted to follow up on some of the earlier Q&A related to 2027. It sounds like you are thinking second half might be a little bit stronger than first half. I am curious if you think that first half of 2027 could be a little bit softer just from a delivery perspective than where you will be at in the second half of 2026. I guess you are expecting the second half of 2027 to be a bit stronger.

Well, Kyle, I don't know. You might be putting a little too many words in my mouth. I think that we have to see what the NCP levels are set at, and I think that'll be very significant to how the market reacts at the beginning of the year. We've seen good interest, but we've seen, obviously, the customers would like to know what the NCP level is going to be. We know they'd like to buy a truck that's durable, reliable, and proven for themselves. But we need to see NCP levels, and once those become finalized, if they're set at a level which is helpful to the truckers who are already dealing with high fuel prices, then that'll be good for the market in the early part of the year.

As you get into the latter part of the year and customers get some time, we'll see what their reactions are. It gets a little bit tougher to predict the market in the second half when it's nine months to a year from now.

Your next question is from Jamie Cook with Truist Securities. Your line is now open. Please go ahead.

Hi, thanks for allowing me to ask a question. I guess my first question, Preston, could you just speak to sort of your competitive positioning in the U.S. with Section 232, how you're performing from a market share opportunity relative to your initial expectations, or do you think, and how you're balancing sort of market share for price in this type of environment? Can we get the Section 232 benefits dropping to the bottom line? Then I guess my second question, again, sorry to ask about next year, but I will anyway. Assuming the U.S. market outperforms Europe next year, just thinking from a geographic mix perspective, the impact on margins, would North America be accretive or is there just sort of more noise associated with NCPs and supplier constraints and stuff like that? Thank you.

Yeah, looking at your first question, I would say probably the easiest thing to do is look at truck margin since December 2025-

Till now, and say that it's gone from $240 million-$570 million. I think that kind of answers the question of the positioning of what's happening, and it's holding market share at a relatively flat position.

Yeah, Jamie, and just to comment about Europe. We still forecast Europe to remain strong in that 300,000-320,000. DAF's done a great job maintaining its position and seeing an increase in order activity in the back half of this year, and we've increased build commensurate with the increased orders. So good forecast in Europe for next year.

Your next question is from Steven Fisher with UBS. Your line is now open. Please go ahead.

Thanks. Good morning. You were able to maintain or hit your margin targets despite the lower deliveries in the quarter. I guess I'm just curious what kind of helped that along. Was it just some general conservatism at the beginning? Were there any particular mix dynamics in there? I think you already said that the tariffs were not a material benefit to it. Just curious, what drove that hitting the margins despite the lower deliveries?

Steven, the simple answer, and it's really true, is amazing people. We have a great team of people all around Paccar, and you've had the chance to be in our factories. You meet the people that work there, you watch what they do every day and how well they can perform in spite of complications. It's super impressive, and it happens at every part of the business, the Paccar Financial Services business, the Paccar Parts business. Those are the contributors more than anything else is to the performance in lieu of lower deliveries. They just keep doing a great job, and that's probably the biggest thing.

Okay, thank you. Obviously there's a lot of talk about supply chain challenges on the call. Just curious how broad those challenges are. Is that mostly within domestic markets? Is it related to imports? Is it just a few, or is it more broad? Any help you can give on that? Thanks.

Yeah, I think the easiest way to think about it at the macro level is build rates have gone up significantly, and they've gone up rather quickly, and that just puts a tax on the system. We have great suppliers. They do a good job of working with us. It's just expecting them to go up this quickly in support of the total industry has created some work for them and a few misses. All you have to do is miss a single part on a truck and it becomes impactful. Almost all of them are performing really well, but all it takes is one or two missed parts to make it meaningful. Our teams are working closely with them, and we're making great progress, hence the guide for higher deliveries in Q4.

Your next question is from Angel Castillo with Morgan Stanley. Your line is now open. Please go ahead.

Hi, good afternoon, and thanks for taking my question. Preston, I wanted to ask a little bit of a bigger picture question around autonomous. Clearly the trucker here is under quite a bit of pressure, ranging from drivers to high fuel prices. I was curious if you could elaborate or at least comment, I guess, in terms of what you're seeing in terms of customers' appetite for perhaps autonomous trucks, given your work with your partners and perhaps more specific to Paccar, as you're seeing the market evolve and all these pressure points on that trucker, any changes as to your appetite or the pace at which you want to move in terms of some of these investments to develop autonomous solutions here that you might be able to deploy to both gain share, but more importantly, help your customer solve some of those issues?

Yeah. Great. I love the way you ended the question, Angel Castillo, in thinking about helping our customers, because that's kind of what we try to do every day. If we have the opportunity to develop safe, reliable technology that helps our customers, then we see autonomy being able to do that, then that's the path we're on. We're developing our own proprietary autonomous vehicle platform, which will make it easier for autonomous systems to be integrated into the truck in the factory. We think that's a significant advantage for the future going forward. Our pace of play on this is really about safety first, right? These are 40-ton vehicles. We want to make sure that they are completely capable, fully validated with production parts, just like any new program we do, and that's determining the pace of our introductions.

We have good partners in Stack AV, Aurora, and others, as we work forward with our customers and how to deploy that. We obviously think the deployment will happen somewhat gradually in lanes, in weather climes, and then it'll roll out in a progressive way. I think the other instructive thing to think at the macro level is it's got to be a win for our customers, it's got to be a win for the developers, and it's got to be a win for Paccar. When all those parties are winning and we have a durable, reliable, safe system, then that's when it'll begin to deploy at scale. So that feels pretty good.

Paccar (PCAR) Q3 2026 Earnings Call Transcript

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