Paccar : TCFD-CDP Report (TCFD IFRS CARB CDP Climate Report Oct 2025rev1)

TCFD Topics Climate Transition Action Plan Elements CDP Climate Sections Governance

Board level oversight: PACCAR's Nominating and Governance Committee Charter states that the committee has responsibility for environmental, social, and governance matters

4.1.1, 4.1.2

Board expertise on climate related issues 4.2

Senior management accountability & feedback mechanism 4.3, 4.3.1

Executive remuneration linked to climate KPI's 4.5, 4.5.1

1.5°C world aligned transition plan within business strategy & shareholder feedback

5.2

Strategy

Link between climate related risks, opportunities, & strategy. 5.3.1

Details of scenario analysis 5.1, 5 1.1, 5.1.2

Financial planning details associated with climate transition 5.3.2, 5.4, 5.4.1 Low carbon product & services 7.74, 7.74.1

Low carbon initiatives - direct operations 7.55.1, 7.55.2, 7.55.3

Value chain engagement - suppliers and customers 5.11, 5.11.5 Alignment of public policy engagement with climate strategy 4.11, 4 11.1, 4.11.2

Risk Mgmt.

Process for identifying and managing climate related risks and opportunities

Climate related risks, potential financial impact, and response strategy

Climate related opportunities, potential financial impact, and response strategy

2.1, 2.2.1, 2.2.2, 2.4

3.1, 3.1.1

3.6, 3.6.1

Approved science-based targets. Scope 1 and 2 emissions by 35% (tonnes) and Scope 3 emissions by 25% (gC02e/vkm) by 2030 from a base year of 2018

7.53, 7.53.1, 7.53.2

Other climate related targets 7.54.1

Pathway to zero emissions 5.5.8

Metrics & Targets

GHG Protocol annual Scope 1, 2, and 3 GHG inventory with third-party verified emission accounting

7.1, 7.11, 7.12, 7.13,

7.2, 7.3, 7.4, 7.4.1,

7.5, 7.6, 7.7, 7.8,

7.8.1, 7.9, 7.9.1,

7.9.2, 7.9.2, 7.10,

7.10.1, 7.10.2, 7.12,

7.12.1, 7.15, 7.15.1,

7.16, 7.17, 7.17.1,

7.17.2, 7.17.3, 7.20,

7.20.1, 7.20.2,

7.20.3, 7.23, 7.23.1,

7.45

Table of Contents

Climate Transition Plan iii

CDP Report 01

C1. Introduction 02

C2. Identification, Assessment, and Management of

Dependencies, Impacts, Risks, and Opportunities 07

C3. Disclosure of Risks and Opportunities 15

C4. Governance 27

C5. Business Strategy 53

C6. Environmental Performance - Consolidation Approach 93

C7. Environmental Performance - Climate Change 94

C10. Environmental Performance - Plastics 172

C11. Environmental Performance - Biodiversity… 169

C13. Further Information & Sign off 179

Forward Looking Statement / Cautionary Statements

PACCAR CDP Climate Change Questionnaire responses may contain statements that are forward looking. These statements are based on current expectations and assumptions that are subject to risks and uncertainties, which may cause actual results to differ materially. A summary of risks and uncertainties is described in more detail in our periodic reports filed with the Securities and Exchange Commission (SEC). We undertake no duty to update or revise these responses whether as a result of new information, future events or otherwise. For the most recent financial, risk and other information about PACCAR, please see our SEC filings and most recent earnings release available on the Investor Relations page of https://www.investors.paccar.com.

Climate Transition Plan

Reporting Boundary: This TCFD and IFRS S2 aligned report covers PACCAR Inc. and its consolidated subsidiaries, including manufacturing facilities, operations, and offices worldwide. The data and disclosures encompass environmental, social, and governance performance for the fiscal year ending December 31, 2024, unless otherwise specified. The report excludes joint ventures, dealers, and suppliers not under PACCAR's direct operational or financial control.

Governance

Board Oversight: PACCAR's Board of Directors oversees climate-related risks and opportunities through its Nominating and Governance Committee, which receives updates at Board meetings. Strategy and performance are standing agenda items and include climate-related items. Management's Role: The Chief Executive Officer (CEO) responsibility includes climate-related strategy, risk assessment, and transition planning. The CEO (who is also a Board member) is accountable for integrating climate-related considerations into business operations and reports progress to the Board. The CEO is supported by the Chief Technology Officer (CTO) and division leaders in executing climate-related initiatives. The CTO leads advanced vehicle technology development (e.g., electrification, alternative fuels) and monitors climate-related trends, reporting to the CEO on a routine basis. This governance framework ensures clear oversight and accountability for climate-related issues from the Board level down through senior management.

Strategy

Climate Transition Plan: PACCAR has a published climate transition plan aligned with a 1.5 °C scenario (Paris Agreement goals). The plan is informed by multiple climate scenario analyses -including IEA Beyond 2°C and Net Zero 2050 scenarios for transition pathways, and IPCC RCP 2.6/4.5/8.5 scenarios for physical climate impacts. The plan is primarily driven by key external dependencies, such as the availability of affordable renewable energy along with fueling and charging infrastructure to support lower- and zero-emission vehicles. PACCAR's strategy assumes a gradual increase of supply of renewable energy and fuels by the energy sector along with new infrastructure to transport and distribute that energy by governments and utility sectors. As these dependencies catalyze so will customer demand for lower- and zero emission vehicles powered by renewable energy. Business Model Resilience: PACCAR is investing heavily to ensure its business remains resilient and competitive in the transition to using renewable energy for powering trucks. PACCAR's excellent long-term profits, strong balance sheet and consistent focus on quality have enabled the company to invest $8.6 billion in new and enhanced facilities, innovative products and new technologies during the past decade. The company has invested in a broad portfolio of more

efficient, low and zero-emission vehicle powertrains including battery-electric and hydrogen fuel cell trucks, as well as hybrid and low-emission engine technologies. These new products position PACCAR well to meet shifting customer demand and regulatory requirements for evolving renewable powered trucks. PACCAR is also improving the efficiency of its manufacturing and operations in preparation to produce these vehicles as ordered by customers. PACCAR invested $796 million in capital projects and $453 million in research and development expenses in 2024. Furthermore, PACCAR engages with its suppliers, dealers, and customers to support decarbonization across the value chain (for example, collaborating on sustainable materials and offering fleet management tools to optimize fuel efficiency).

Collectively, these strategic efforts mitigate transition risks and create opportunities. PACCAR's climate-related strategy is integrated with its overall corporate strategy and is continuously reviewed to adapt to emerging market and technological trends.

Risk Management

Integration into Risk Management: Risks, including climate-related risks, are identified, assessed and managed within PACCAR's compliance and risk management framework. Management evaluates risks at least semi-annually as part of multi-disciplinary risk reviews including climate-related risk. This process covers the full value chain (from supply chain to operations to product use) and multiple time horizons (short, medium, and long-term). Key categories of climate-related risk considered include transition risks, e.g., changing customer preferences for low-emission trucks, and greenhouse gas regulation by agencies like CARB, EPA, and the EU; and physical risks, e.g., acute extreme weather events or chronic climate shifts that could affect facilities or supply continuity. PACCAR also identifies climate-related opportunities, such as increased demand for fuel efficient, low, and zero-emission trucks and partnerships in battery and fuel-cell technology, which are evaluated alongside risks.

PACCAR addresses risks through proactive mitigation strategies. For market transition risk, the company is diversifying its product mix by accelerating development of biofuels, electric, hybrid, and hydrogen-powered trucks, thereby reducing the risk of lost market share. For regulatory risk, PACCAR invests in continuous improvement of engine efficiency and emissions controls, conducts compliance testing, and engages with policymakers through industry groups to keep compliant of new regulations. For physical risks, PACCAR has business continuity plans: supply chain and manufacturing are geographically diversified, facilities are built with local climate-related risks in mind, and the company carries insurance. PACCAR also works closely with critical suppliers on their preparedness and conducts assessments of suppliers' resilience. Risks are integrated into PACCAR's Compliance and Risk Management process. The Executive Committee and Board receive regular updates on risk exposure and mitigation progress.

PACCAR's active risk management has so far prevented climate-related issues from materially impacting operations or financial results. The company will continue to monitor all risks and

adjust its strategies as needed. PACCAR discloses material risks in its annual financial filing Form 10-K. At present, all identified climate-related risks are projected to remain below this threshold.

Scenario Analysis

PACCAR employs climate scenario analysis to test the resilience of its strategy against a range of possible futures. The company uses both transition scenarios and physical climate scenarios for these assessments:

For transition risk: PACCAR models a rapid decarbonization scenario (e.g., IEA Net Zero 2050). This assumes infrastructure provides access to affordable renewable energy, aggressive policies, technology shifts to low/zero-emission vehicles, and high carbon prices. PACCAR also considers regulatory-specific scenarios using tools like EPA's GEM and the EU VECTO model to anticipate and keep pace with compliance requirements. In addition, PACCAR updates models for total energy forecast (e.g., IEA World Energy Outlook 2025) and the forecasted availability, reliability, and affordability of energy for the transportation sector, specifically for heavy and medium duty trucks, to evaluate customer demand based on total cost of ownership for different truck models.

For physical risk: PACCAR evaluates a high-emissions scenario (akin to IPCC RCP 8.5) where global warming may lead to more frequent and severe extreme weather by mid-century. Site-level impacts (flood plains, storm intensity, wildfire zones, etc.) are analyzed under this scenario, as well as a moderate scenario (RCP 4.5) and low-emissions pathway (RCP 2.6) for comparison. Key Findings: The scenario analysis to date indicates that PACCAR's current strategy is resilient and no anticipated climate-related scenario is likely to cause a material financial impact on the company. In an aggressive transition scenario aligned with 1.5 °C, the heavy-duty truck market shifts rapidly to low and zero-emission technologies by 2050. PACCAR's modeling shows that, because of its ongoing investments in new products and its ability to manufacture those trucks, it can retain market share. Under a severe physical climate scenario, catastrophic events and impacts are contained by business continuity planning including PACCAR's diversified operations and continued investment in those operations, supply chain and insurance coverage.

These scenario results have been integrated into PACCAR's strategic planning. For example, insights influenced the scale and timing of PACCAR's investments. Physical risk scenarios have guided facilities planning. Overall, the scenario analysis reinforces that PACCAR's proactive measures effectively limit its climate-related risk exposure. The company will continue to update scenario analyses at least every two years, or more frequently if material new risks