Log in
Log in
Or log in with
GoogleGoogle
Twitter Twitter
Facebook Facebook
Apple Apple     
Sign up
Or log in with
GoogleGoogle
Twitter Twitter
Facebook Facebook
Apple Apple     
  1. Homepage
  2. Equities
  3. United States
  4. Nasdaq
  5. Paccar, Inc.
  6. News
  7. Summary
    PCAR   US6937181088

PACCAR, INC.

(PCAR)
  Report
Delayed Nasdaq  -  04:00 2022-09-29 pm EDT
84.87 USD   -0.54%
09/13PACCAR Raises Quarterly Dividend by 9% to $0.37 Per Share, Payable on Dec. 6 to Shareholders of Record on Nov. 15
MT
09/13PACCAR Increases Regular Quarterly Dividend
BU
09/13PACCAR Inc Increases Regular Quarterly Dividend, Payable on December 6, 2022
CI
SummaryQuotesChartsNewsRatingsCalendarCompanyFinancialsConsensusRevisionsFunds 
SummaryMost relevantAll NewsAnalyst Reco.Other languagesPress ReleasesOfficial PublicationsSector newsMarketScreener Strategies

PACCAR INC MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (form 10-Q)

08/02/2022 | 04:17pm EDT

OVERVIEW:


PACCAR is a global technology company whose Truck segment includes the design
and manufacture of high-quality light-, medium- and heavy-duty commercial
trucks. In North America, trucks are sold under the Kenworth and Peterbilt
nameplates, in Europe, under the DAF nameplate and in Australia and South
America, under the Kenworth and DAF nameplates. The Parts segment includes the
distribution of aftermarket parts for trucks and related commercial vehicles.
The Company's Financial Services segment derives its earnings primarily from
financing or leasing PACCAR products in North America, Europe, Australia and
South America. The Company's Other business includes the manufacturing and
marketing of industrial winches.

Second Quarter Financial Highlights: • Worldwide net sales and revenues were $7.16 billion in 2022 compared to $5.84

billion in 2021, primarily due to higher truck and parts revenues.

• Truck revenues were $5.34 billion in 2022 compared to $4.15 billion in 2021,

primarily due to higher truck deliveries and price realization in all markets.

• Parts sales were $1.43 billion in 2022 compared to $1.21 billion in 2021

reflecting higher demand and price realization in all markets.

• Financial Services revenues were $372.5 million in 2022 compared to $456.3

million in 2021, primarily due to lower used truck sales.

• Net income was $720.4 million ($2.07 per diluted share) in 2022 compared to

$495.5 million ($1.42 per diluted share) in 2021 due to higher Truck, Parts

and Financial Services operating results.

• Capital investments were $121.0 million in 2022 compared to $120.2 million in

2021.

• Research and development (R&D) expenses were $80.4 million in 2022 compared to

$84.4 million in 2021.

First Six Months Financial Highlights: • Worldwide net sales and revenues were $13.63 billion in 2022 compared to

$11.69 billion in 2021, primarily due to higher truck and parts revenues.

• Truck revenues were $10.03 billion in 2022 compared to $8.39 billion in 2021,

primarily due to higher truck deliveries in Europe and higher price

realization in all markets.

• Parts sales were $2.82 billion in 2022 compared to $2.37 billion in 2021

reflecting higher demand and price realization in all markets.

• Financial Services revenues were $738.7 million in 2022 compared to $888.3

million in 2021, primarily due to lower used truck sales.

• Net income was $1.32 billion ($3.79 per diluted share) in 2022 compared to

$966.3 million ($2.77 per diluted share) in 2021 due to higher Truck, Parts

and Financial Services operating results.

• Capital investments were $234.5 million in 2022 compared to $214.4 million in

2021.

• Research and development (R&D) expenses were $158.4 million in 2022 compared

to $164.5 million in 2021.



A DAF CF Electric truck became the first battery electric heavy truck to summit
Austria's highest mountain pass on the Grossglockner High Alpine Road. The
vehicle exhibited superb power and maneuverability through 30 miles, 36 hairpin
bends and a grade of 12%. The DAF CF Electric is used by customers in
applications such as regional distribution, refuse collection and port drayage.

The PACCAR Financial Services (PFS) group of companies has operations covering
four continents and 26 countries. The global breadth of PFS and its rigorous
credit application process support a portfolio of loans and leases with total
assets of $16.04 billion. PFS issued $1.63 billion in medium-term notes during
the first six months of 2022 to support new business volume and repay maturing
debt.


                                     - 34 -
--------------------------------------------------------------------------------



Conflict in Ukraine
In accordance with international sanctions, the Company has suspended truck and
parts sales to Russia and Belarus. The Company has no factories in Russia and
has managed export sales to Russia through independent dealers. In 2021, 2,500
trucks were sold into Russia and Belarus. The Company also sold parts in these
markets through a third-party owned warehouse. The trucks were sold on a fully
paid-up basis; accordingly, the Company does not have significant receivables
exposure. Inventory balances are not significant. The Company is monitoring the
situation closely. At this time, the conflict has not had a significant impact
on the results of operations or cash flows of the Company.

Truck Outlook
Truck industry heavy-duty retail sales in the U.S. and Canada in 2022 are
expected to be 260,000 to 290,000 units compared to 250,000 in 2021. In Europe,
2022 truck industry registrations for over 16-tonne vehicles are expected to be
270,000 to 300,000 units compared to 278,000 in 2021. In South America,
heavy-duty truck industry registrations in 2022 are projected to be 125,000 to
135,000 as compared to 127,000 in 2021.

The Company has been affected by an industry-wide undersupply of semiconductor
chips and component parts, and anticipates the shortages will continue to affect
deliveries in 2022.

Parts Outlook
In 2022, PACCAR Parts sales are expected to increase 13-16% compared to 2021
levels reflecting strong freight demand.

Financial Services Outlook
Based on the truck market outlook, average earning assets in 2022 are expected
to increase 3-5% compared to 2021. Current high levels of freight tonnage,
freight rates and fleet utilization are contributing to customers' profitability
and cash flow.

Capital Investments and R&D Outlook
Capital investments in 2022 are expected to be $425 to $475 million and R&D is
expected to be $330 to $350 million. The Company
is increasing its investment in clean diesel and electric powertrain
technologies, autonomous systems, connected vehicle services, next-generation
manufacturing and parts distribution capabilities.

See the Forward-Looking Statements section of Management's Discussion and Analysis for factors that may affect these outlooks.

RESULTS OF OPERATIONS:


The Company's results of operations for the three months ended June 30, 2022 and
2021 are presented below.

                                               Three Months Ended            Six Months Ended
                                                     June 30                      June 30
($ in millions, except per share amounts)         2022          2021           2022           2021
Net sales and revenues:
Truck                                        $ 5,336.4     $ 4,152.2     $ 10,033.5     $  8,385.2
Parts                                          1,434.7       1,211.3        2,823.6        2,372.0
Other                                             15.1          24.1           35.5           43.9
Truck, Parts and Other                         6,786.2       5,387.6       12,892.6       10,801.1
Financial Services                               372.5         456.3          738.7          888.3
                                             $ 7,158.7     $ 5,843.9     $ 13,631.3     $ 11,689.4
Income (loss) before income taxes:
Truck                                        $   422.1     $   256.5     $    698.8     $    526.5
Parts                                            353.3         266.8          693.5          518.4
Other                                             (3.1 )         5.5            6.9           10.9
Truck, Parts and Other                           772.3         528.8        1,399.2        1,055.8
Financial Services                               144.4         106.5          291.4          182.9
Investment income                                  5.4           5.0            2.9            9.9
Income taxes                                    (201.7 )      (144.8 )       (372.6 )       (282.3 )
Net income                                   $   720.4     $   495.5     $  1,320.9     $    966.3
Diluted earnings per share                   $    2.07     $    1.42     $     3.79     $     2.77
After-tax return on revenues                      10.1 %         8.5 %          9.7 %          8.3 %




                                     - 35 -
--------------------------------------------------------------------------------



The following provides an analysis of the results of operations for the
Company's three reportable segments - Truck, Parts and Financial Services. Where
possible, the Company has quantified the impact of factors identified in the
following discussion and analysis. In cases where it is not possible to quantify
the impact of factors, the Company lists them in estimated order of importance.
Factors for which the Company is unable to specifically quantify the impact
include market demand, fuel prices, freight tonnage, economic conditions and
COVID-19 related factors affecting the Company's results of operations.

2022 Compared to 2021:

Truck


The Company's Truck segment accounted for 75% and 74% of revenues in the second
quarter and first six months of 2022, respectively, compared to 71% and 72% in
the second quarter and first six months of 2021, respectively.

The Company's new truck deliveries are summarized below:

                                            Three Months Ended                        Six Months Ended
                                                 June 30                                  June 30
                                       2022         2021       % CHANGE         2022         2021       % CHANGE
U.S. and Canada                      24,400       22,600              8       45,100       45,600             (1 )
Europe                               15,400       11,800             31       31,500       25,500             24
Mexico, South America, Australia
and other                             7,100        5,700             25       13,300       11,200             19
Total units                          46,900       40,100             17       89,900       82,300              9



The increase in new truck deliveries worldwide in the second quarter compared to
the same period of 2021 was driven by higher deliveries in all markets. The
increase in deliveries for the first six months primarily relates to higher
deliveries in Europe. The industry-wide undersupply of semiconductor chips and
component products continues to impact deliveries.

Market share data discussed below is provided by third-party sources and is measured by either registrations or retail sales for the Company's dealer network as a percentage of total registrations or retail sales depending on the geographic market. In the U.S. and Canada, market share is based on retail sales. In Europe, market share is based primarily on registrations.


In the first six months of 2022, industry retail sales in the heavy-duty market
in the U.S. and Canada were 126,300 units comparable to 126,200 units in the
same period of 2021. The Company's heavy-duty truck retail market share was
29.4% in the first six months of 2022 compared to 29.4% in the first six months
of 2021. The medium-duty market was 42,800 units in the first six months of 2022
compared to 44,400 units in the same period of 2021. The Company's medium-duty
market share was 9.7% in the first six months of 2022 compared to 20.1% in the
first six months of 2021.

The over 16­tonne truck market in Europe in the first six months of 2022 was
148,600 units compared to 147,900 units in the first six months of 2021. DAF
over 16­tonne market share was a 17.5% in the first six months of 2022 compared
to 15.7% in the same period of 2021. The 6 to 16­tonne market in the first six
months of 2022 was 19,200 units compared to 22,500 units in the same period of
2021. DAF market share in the 6 to 16-tonne market in the first six months of
2022 was 10.1% compared to 10.7% in the same period of 2021.

The Company's worldwide truck net sales and revenues are summarized below:


                                             Three Months Ended                          Six Months Ended
                                                  June 30                                     June 30
($ in millions)                         2022          2021       % CHANGE           2022          2021       % CHANGE
Truck net sales and revenues:
U.S. and Canada                    $ 3,157.0     $ 2,543.2             24     $  5,747.6     $ 5,098.2             13
Europe                               1,390.1         994.9             40        2,841.0       2,119.1             34
Mexico, South America, Australia
and other                              789.3         614.1             29        1,444.9       1,167.9             24
                                   $ 5,336.4     $ 4,152.2             29     $ 10,033.5     $ 8,385.2             20
Truck income before income taxes   $   422.1     $   256.5             65     $    698.8     $   526.5             33
Pre-tax return on revenues               7.9 %         6.2 %                

7.0 % 6.3 %




The Company's worldwide truck net sales and revenues in the second quarter
increased to $5.34 billion in 2022 from $4.15 billion in 2021 due to improved
price realization and higher truck deliveries in all markets. Revenues for the
first six months increased to $10.03 billion in 2022 from $8.39 billion in 2021
primarily due to higher truck unit deliveries in Europe and improved price
realization in all markets. Favorable second quarter and first six months
results were partially offset by unfavorable currency translation effects.


                                     - 36 -
--------------------------------------------------------------------------------



For the second quarter and first six months of 2022, Truck segment income before
income taxes and pretax return on revenues reflect the tempering of truck unit
deliveries due to the global semiconductor and component supply shortages. In
the second quarter and first six months of 2022, Truck segment income before
taxes and pretax return on revenues increased to reflect the impact of higher
truck unit deliveries.

The major factors for the Truck segment changes in net sales and revenues, cost
of sales and revenues and gross margin between the three months ended June 30,
2022 and 2021 are as follows:

                                                         NET         COST OF
                                                   SALES AND       SALES AND          GROSS
($ in millions)                                     REVENUES        REVENUES         MARGIN
Three Months Ended June 30, 2021                 $   4,152.2     $   3,771.3     $    380.9
Increase (decrease)
Truck sales volume                                     745.6           650.1           95.5
Average truck sales prices                             630.9                          630.9
Average per truck material, labor and other
direct costs                                                           512.8         (512.8 )
Factory overhead and other indirect costs                               36.7          (36.7 )
Extended warranties, operating leases and
other                                                   23.0            19.0            4.0
Currency translation                                  (215.3 )        (201.5 )        (13.8 )
Total increase                                       1,184.2         1,017.1          167.1
Three Months Ended June 30, 2022                 $   5,336.4     $   

4,788.4 $ 548.0

• Truck sales volume reflects higher unit deliveries in all major markets due to

increased demand.

• Average truck sales prices increased sales by $630.9 million, primarily due to

higher price realization worldwide.

• Average cost per truck increased cost of sales by $512.8 million, primarily

reflecting higher raw material, labor and freight costs.

• Factory overhead and other indirect costs increased $36.7 million, primarily

due to higher labor costs, utilities and depreciation.

• Extended warranties, operating leases and other increased revenues by $23.0

million and cost of sales by $19.0 million primarily due to higher revenues

and associated costs from repair and maintenance and service contracts.

• The currency translation effect on sales and cost of sales primarily reflects

a decline in the value of the euro relative to the U.S. dollar.

• Truck gross margin was 10.3% in the second quarter of 2022 compared to 9.2% in

the same period of 2021 due to the factors noted above.



The major factors for the Truck segment changes in net sales and revenues, cost
of sales and revenues and gross margin between the six months ended June 30,
2022 and 2021 are as follows:
                                                        NET         COST OF
                                                  SALES AND       SALES AND          GROSS
($ in millions)                                    REVENUES        REVENUES         MARGIN
Six Months Ended June 30, 2021                   $  8,385.2     $   7,612.2     $    773.0
Increase (decrease)
Truck sales volume                                    878.0           763.7          114.3
Average truck sales prices                          1,031.4                        1,031.4
Average per truck material, labor and other
direct costs                                                          902.9         (902.9 )
Factory overhead and other indirect costs                              83.4          (83.4 )
Extended warranties, operating leases and
other                                                  61.6            22.8           38.8
Currency translation                                 (322.7 )        (300.5 )        (22.2 )
Total increase                                      1,648.3         1,472.3          176.0
Six Months Ended June 30, 2022                   $ 10,033.5     $   9,084.5 

$ 949.0

• Truck sales volume reflects higher heavy-duty truck deliveries in all major

markets partially offset by lower medium-duty truck deliveries in the U.S. and

Canada.

• Average truck sales prices increased sales by $1.03 billion, primarily due to

higher price realization worldwide.

• Average cost per truck increased cost of sales by $902.9 million, primarily

reflecting higher raw material, labor and freight costs.

• Factory overhead and other indirect costs increased $83.4 million, primarily

due to higher labor costs, utilities and depreciation.

                                     - 37 -
--------------------------------------------------------------------------------

• Extended warranties, operating leases and other increased revenues by $61.6

million and cost of sales by $22.8 million primarily due to higher revenues

and associated costs from repair and maintenance, service contracts and

operating leases. In addition, cost of sales and revenues was partially offset

by gains on sales of used trucks and lower impairments in Europe due to an

improved used truck market.

• The currency translation effect on sales and cost of sales primarily reflects

a decline in the value of the euro relative to the U.S. dollar.

• Truck gross margin was 9.5% in the first six months of 2022 compared to 9.2%

in the same period of 2021 due to the factors noted above.



Truck SG&A expense increased in the second quarter of 2022 to $67.5 million from
$63.9 million in 2021, and for the first six months of 2022, Truck SG&A
increased to $140.9 million from $125.0 million in 2021. The increase in both
periods was primarily due to higher professional expenses, higher salaries and
related expenses and higher sales and marketing costs, partially offset by
currency translation effects.

As a percentage of sales, Truck SG&A decreased to 1.3% and 1.4% in the second quarter and first six months of 2022, respectively, compared to 1.5% in the second quarter and first six months of 2021.

Parts


The Company's Parts segment accounted for 20% and 21% of revenues in the second
quarter and first six months of 2022, respectively, compared to 21% and 20% in
the second quarter and first six months of 2021, respectively.

                                             Three Months Ended                          Six Months Ended
                                                  June 30                                    June 30
($ in millions)                         2022          2021       % CHANGE          2022          2021       % CHANGE
Parts net sales and revenues:
U.S. and Canada                    $ 1,030.6     $   809.3             27     $ 2,006.3     $ 1,576.5             27
Europe                                 273.1         288.1             (5 )       569.2         574.2             (1 )
Mexico, South America, Australia
and other                              131.0         113.9             15         248.1         221.3             12
                                   $ 1,434.7     $ 1,211.3             18     $ 2,823.6     $ 2,372.0             19
Parts income before income taxes   $   353.3     $   266.8             32     $   693.5     $   518.4             34
Pre-tax return on revenues              24.6 %        22.0 %                       24.6 %        21.9 %



The Company's worldwide parts net sales and revenues for the second quarter
increased to $1.43 billion in 2022 from $1.21 billion in 2021. For the first six
months, worldwide parts net sales and revenues increased to $2.82 billion in
2022 from $2.37 billion in 2021. The increase in both periods was primarily due
to higher demand in all markets, partially offset by unfavorable currency
translation effects.

For the second quarter and first six months of 2022, the increase in Parts
segment income before income taxes and pre-tax return on revenues was primarily
due to higher sales volume and higher margins, partially offset by unfavorable
currency translation effects.

The major factors for the changes in Parts segment net sales and revenues, cost
of sales and revenues and gross margin between the three months ended June 30,
2022 and 2021 are as follows:
                                                NET        COST OF
                                          SALES AND      SALES AND       GROSS
($ in millions)                            REVENUES       REVENUES      MARGIN
Three Months Ended June 30, 2021         $  1,211.3     $    868.6     $ 342.7
Increase (decrease)
Aftermarket parts volume                      136.8           85.7        

51.1

Average aftermarket parts sales prices        128.3                      

128.3

Average aftermarket parts direct costs                        60.9       (60.9 )
Warehouse and other indirect costs                            13.7       (13.7 )
Currency translation                          (41.7 )        (25.2 )     (16.5 )
Total increase                                223.4          135.1        88.3

Three Months Ended June 30, 2022 $ 1,434.7 $ 1,003.7 $ 431.0

• Aftermarket parts sales volume increased by $136.8 million and related cost of

sales increased by $85.7 million due to higher demand in all markets.

                                     - 38 -
--------------------------------------------------------------------------------

• Average aftermarket parts sales prices increased sales by $128.3 million

primarily due to higher price realization in North America and Europe.

• Average aftermarket parts direct costs increased $60.9 million due to higher

material and freight costs.

• Warehouse and other indirect costs increased $13.7 million primarily due to

higher salaries and related expenses.

• The currency translation effect on sales and cost of sales primarily reflects

a decline in the value of the euro relative to the U.S. dollar.

• Parts gross margins in the second quarter of 2022 increased to 30.0% from

28.3% in the second quarter of 2021 due to the factors noted above.




The major factors for the changes in Parts segment net sales and revenues, cost
of sales and revenues and gross margin between the six months ended June 30,
2021 and 2020 are as follows:
                                                NET        COST OF
                                          SALES AND      SALES AND        GROSS
($ in millions)                            REVENUES       REVENUES       MARGIN
Six Months Ended June 30, 2021           $  2,372.0     $  1,701.4     $  

670.6

Increase (decrease)
Aftermarket parts volume                      255.1          162.8         

92.3

Average aftermarket parts sales prices        259.7                       

259.7

Average aftermarket parts direct costs                       122.3       (122.3 )
Warehouse and other indirect costs                            26.4        (26.4 )
Currency translation                          (63.2 )        (38.9 )      (24.3 )
Total increase                                451.6          272.6        179.0
Six Months Ended June 30, 2022           $  2,823.6     $  1,974.0     $  

849.6

• Aftermarket parts sales volume increased by $255.1 million and related cost of

sales increased by $162.8 million due to higher demand in all markets.

• Average aftermarket parts sales prices increased sales by $259.7 million

primarily due to higher price realization in North America and Europe.

• Average aftermarket parts direct costs increased $122.3 million due to higher

material and freight costs.

• Warehouse and other indirect costs increased $26.4 million primarily due to

higher salaries and related expenses.

• The currency translation effect on sales and cost of sales primarily reflects

a decline in the value of the euro relative to the U.S. dollar.

• Parts gross margins in the first six months of 2022 increased to 30.1% from

28.3% in the first six months of 2021 due to the factors noted above.




Parts SG&A expense increased in the second quarter of 2022 to $54.6 million from
$53.0 million in 2021, and for the first six months, Parts SG&A increased to
$109.5 million in 2022 from $104.7 million in 2021. The increase in both periods
was primarily due to higher salaries and related expenses, partially offset by
lower sales and marketing costs and currency translation effects.

As a percentage of sales, Parts SG&A was 3.8% and 3.9% in the second quarter and
first six months of 2022, respectively, compared to 4.4% in the second quarter
and first six months of 2021.

                                     - 39 -
--------------------------------------------------------------------------------

Financial Services

The Company's Financial Services segment accounted for 5% of revenues in the second quarter and first six months of 2022, compared to 8% in the second quarter and first six months of 2021, respectively.

                                                  Three Months Ended                           Six Months Ended
                                                        June 30                                     June 30
($ in millions)                               2022           2021      % CHANGE           2022           2021      % CHANGE
New loan and lease volume:
U.S. and Canada                         $    817.2     $    964.5           (15 )   $  1,654.0     $  1,699.0            (3 )
Europe                                       347.8          338.6             3          698.0          667.5             5
Mexico, Australia and other                  333.8          257.3            30          631.0          465.4            36
                                        $  1,498.8     $  1,560.4            (4 )   $  2,983.0     $  2,831.9             5
New loan and lease volume by product:
Loans and finance leases                $  1,204.7     $  1,300.7            (7 )   $  2,448.6     $  2,332.8             5
Equipment on operating lease                 294.1          259.7            13          534.4          499.1             7
                                        $  1,498.8     $  1,560.4            (4 )   $  2,983.0     $  2,831.9             5
New loan and lease unit volume:
Loans and finance leases                    10,130         10,690            (5 )       19,730         19,850            (1 )
Equipment on operating lease                 3,080          2,910             6          5,960          5,360            11
                                            13,210         13,600            (3 )       25,690         25,210             2
Average earning assets:
U.S. and Canada                         $  8,747.5     $  8,795.4            (1 )   $  8,630.0     $  8,774.0            (2 )
Europe                                     3,853.6        3,841.6                      3,843.2        3,880.4            (1 )
Mexico, Australia and other                2,520.6        2,080.9            21        2,421.4        2,056.0            18
                                        $ 15,121.7     $ 14,717.9             3     $ 14,894.6     $ 14,710.4             1
Average earning assets by product:
Loans and finance leases                $ 10,273.5     $ 10,018.9             3     $ 10,174.1     $  9,903.9             3
Dealer wholesale financing                 2,023.0        1,506.4            34        1,848.3        1,612.8            15
Equipment on lease and other               2,825.2        3,192.6           (12 )      2,872.2        3,193.7           (10 )
                                        $ 15,121.7     $ 14,717.9             3     $ 14,894.6     $ 14,710.4             1
Revenues:
U.S. and Canada                         $    168.3     $    218.0           (23 )   $    336.9     $    407.5           (17 )
Europe                                       124.9          176.0           (29 )        254.4          358.1           (29 )
Mexico, Australia and other                   79.3           62.3            27          147.4          122.7            20
                                        $    372.5     $    456.3           (18 )   $    738.7     $    888.3           (17 )
Revenue by product:
Loans and finance leases                $    128.8     $    122.1             5     $    247.2     $    240.2             3
Dealer wholesale financing                    22.1           10.3           115           36.0           22.1            63
Equipment on lease and other                 221.6          323.9           (32 )        455.5          626.0           (27 )
                                        $    372.5     $    456.3           (18 )   $    738.7     $    888.3           (17 )
Income before income taxes              $    144.4     $    106.5            36     $    291.4     $    182.9            59



For the second quarter, new loan and lease volume was $1,498.8 million in 2022
compared to $1,560.4 million in 2021 reflecting lower new loan and lease volume
in the U.S. and Canada, partially offset by higher new loan and lease volume in
Brasil, Europe and Mexico. For the first half of 2022, new loan and lease unit
volume was $2,983.0 million compared to $2,831.9 million in 2021, primarily
reflecting higher new loan and lease volume in Brasil, Europe and Mexico,
partially offset by lower new loan and lease volume in the U.S. and Canada. The
effect of currency translation decreased new loan and lease volume by $50.5
million and $80.7 million in the second quarter and first half of 2022,
primarily due to the lower euro and Australian dollar relative to the U.S.
dollar.

In the second quarter of 2022, PFS finance market share of new PACCAR truck
sales was 25.0% compared to 27.9% in the second quarter of 2021. In the first
six months of 2022, PFS finance market share of new PACCAR truck sales was 26.4%
compared to 26.5% in the first six months of 2021.

In the second quarter of 2022, PFS revenues decreased to $372.5 million from
$456.3 million in 2021. In the first six months of 2022, PFS revenues decreased
to $738.7 million from $888.3 million in 2021. The decreases for both periods
were primarily due to lower used truck sales in Europe and the U.S. The effects
of currency translation decreased PFS revenues by $16.7 million and $26.0
million in the second quarter and first half of 2022, respectively, primarily
due to a lower euro relative to the U.S. dollar.

                                     - 40 -
--------------------------------------------------------------------------------



PFS income before income taxes increased to $144.4 million in the second quarter
of 2022 from $106.5 million in the second quarter of 2021. In the first six
months of 2022, PFS income before income taxes increased to $291.4 million from
$182.9 million in 2021. The increase in both periods was primarily due to
improved used truck results. The effects of translating weaker foreign
currencies to the U.S. dollar decreased PFS income before income taxes by $5.7
million and $8.4 million for the second quarter and first half of 2022,
respectively, primarily due to a lower euro relative to the U.S. dollar.

Included in Financial Services "Other assets" on the Company's Consolidated
Balance Sheets are used trucks held for sale, net of impairments, of $99.3
million at June 30, 2022 and $92.1 million at December 31, 2021. These trucks
are primarily units returned from matured operating leases in the ordinary
course of business, and also include trucks acquired from repossessions or
through acquisitions of used trucks in trades related to new truck sales and
trucks returned from residual value guarantees (RVGs).

The Company recognized gains on used trucks, excluding repossessions, of $34.7
million in the second quarter of 2022 compared to losses of $3.3 million in the
second quarter of 2021, including losses on multiple unit transactions of nil in
the second quarter of 2022 compared to $6.1 million in the second quarter of
2021. Used truck losses related to repossessions, which are recognized as credit
losses, and used truck gains, which are recognized as credit recoveries, were
not significant for either the second quarter of 2022 or 2021.

The Company recognized gains on used trucks, excluding repossessions, of $69.9
million in the first six months of 2022 compared to $11.1 million of losses in
the first six months of 2021, including losses on multiple unit transactions of
$.3 million in the first six months of 2022 compared to $16.9 million in the
first six months of 2021. Used truck losses related to repossessions, which are
recognized as credit losses, and used truck gains, which are recognized as
credit recoveries, were not significant for either the first six months of 2022
or 2021.

The major factors for the changes in interest and fees, interest and other
borrowing expenses and finance margin for the three months ended June 30, 2022
and 2021 are outlined below:

                                                     INTEREST
                                                    AND OTHER
                                     INTEREST       BORROWING      FINANCE
($ in millions)                      AND FEES        EXPENSES       MARGIN
Three Months Ended June 30, 2021   $    132.4     $      37.6     $   94.8
Increase (decrease)
Average finance receivables              14.0                         14.0
Average debt balances                                     1.9         (1.9 )
Yields                                    7.3                          7.3
Borrowing rates                                           6.9         (6.9 )
Currency translation and other           (2.8 )                       (2.8 )
Total increase                           18.5             8.8          9.7

Three Months Ended June 30, 2022 $ 150.9 $ 46.4 $ 104.5

• Average finance receivables increased $1,159.7 million (excluding foreign

exchange effects) in the second quarter of 2022 primarily due to higher

average loan and dealer wholesale balances.

• Average debt balances increased $449.3 million (excluding foreign exchange

effects) in the second quarter of 2022, reflecting higher funding requirements

for the portfolio, which includes loans, finance leases, dealer wholesale and

equipment on operating lease.

• Higher portfolio yields (4.9% in 2022 compared to 4.5% in 2021) increased

interest and fees by $7.3 million. The higher portfolio yields were primarily

due to higher market rates in Europe and Brasil, partially offset lower rates

in North America.

• Higher borrowing rates (1.7% in 2022 compared to 1.4% in 2021) were primarily

due to higher debt market rates in Brasil, Canada and Europe.

• The currency translation effects reflect a decrease in the value of foreign

currencies relative to the U.S. dollar, primarily the euro.

                                     - 41 -
--------------------------------------------------------------------------------




The major factors for the changes in interest and fees, interest and other
borrowing expenses and finance margin between the six months ended June 30, 2022
and 2021 are outlined below:


                                                   INTEREST
                                                  AND OTHER
                                   INTEREST       BORROWING      FINANCE
($ in millions)                    AND FEES        EXPENSES       MARGIN
Six Months Ended June 30, 2021   $    262.3     $      79.6     $  182.7
Increase (decrease)
Average finance receivables            19.0                         19.0
Average debt balances                                   1.8         (1.8 )
Yields                                  5.9                          5.9
Borrowing rates                                         4.7         (4.7 )
Currency translation and other         (4.0 )            .1         (4.1 )
Total increase                         20.9             6.6         14.3

Six Months Ended June 30, 2022 $ 283.2 $ 86.2 $ 197.0

• Average finance receivables increased $785.3 million (excluding foreign

exchange effects) in the first six months of 2022 primarily due to higher

average loan and dealer wholesale balances.

• Average debt balances increased by $221.0 million (excluding foreign exchange

effects) in the first six months of 2022, reflecting higher funding

requirements for the portfolio, which includes loans, finance leases, dealer

wholesale and equipment on operating lease.

• Higher portfolio yields (4.8% in 2022 compared to 4.6% in 2021) increased

interest and fees by $5.9 million. The higher portfolio yields were primarily

due to higher market rates in Europe, Brasil and Mexico, partially offset by

lower rates in the U.S.

• Higher borrowing rates (1.6% in 2022 compared to 1.5% in 2021) were primarily

due to higher debt market rates in Brasil, Canada and Mexico, partially offset

by lower rates in the U.S.

• The currency translation effects reflect a decrease in the value of foreign

currencies relative to the U.S. dollar, primarily the euro.

The following table summarizes operating lease, rental and other revenues and depreciation and other expenses:

                                                Three Months Ended             Six Months Ended
                                                      June 30                      June 30
($ in millions)                                    2022           2021           2022          2021
Operating lease and rental revenues          $    204.5      $   219.5     $    413.1     $   435.4
Used truck sales                                   12.8           99.5           33.4         181.2
Insurance, franchise and other revenues             4.3            4.9            9.0           9.4

Operating lease, rental and other revenues $ 221.6 $ 323.9 $ 455.5 $ 626.0


Depreciation of operating lease equipment    $    124.0      $   153.6     $    236.5     $   318.8
Vehicle operating expenses                          9.0           26.3           19.4          57.2
Cost of used truck sales                           12.2           99.6           31.9         181.2
Insurance, franchise and other expenses              .2            1.0            1.1           2.0
Depreciation and other expenses              $    145.4      $   280.5     $    288.9     $   559.2




                                     - 42 -
--------------------------------------------------------------------------------



The major factors for the changes in operating lease, rental and other revenues,
depreciation and other expenses and lease margin between the three months ended
June 30, 2022 and 2021 are outlined below:


                                         OPERATING
                                     LEASE, RENTAL       DEPRECIATION
                                         AND OTHER          AND OTHER       LEASE
($ in millions)                           REVENUES           EXPENSES      MARGIN

Three Months Ended June 30, 2021 $ 323.9 $ 280.5 $

43.4

(Decrease) increase
Used truck sales                             (85.2 )            (85.9 )     

.7

Results on returned lease assets                                (33.9 )     

33.9

Average operating lease assets               (10.3 )             (8.4 )      (1.9 )
Revenue and cost per asset                     7.5                3.8       

3.7

Currency translation and other               (14.3 )            (10.7 )      (3.6 )
Total (decrease) increase                   (102.3 )           (135.1 )     

32.8

Three Months Ended June 30, 2022 $ 221.6 $ 145.4 $

76.2

• Lower sales volume of used trucks in Europe and the U.S. decreased revenues by

$85.2 million and related depreciation and other expenses by $85.9 million.

• Results on returned lease assets decreased depreciation and other expenses by

$33.9 million primarily due to higher gains on sales on returned lease units

as a result of higher used truck market values.

• Average operating lease assets decreased $170.5 million (excluding foreign

exchange effects), which decreased revenues by $10.3 million and related

depreciation and other expenses by $8.4 million.

• Revenue per asset increased $7.5 million primarily due to higher rental

utilization in the North America. Cost per asset increased $3.8 million due to

higher operating lease depreciation.

• The currency translation effects reflect a decrease in the value of foreign

currencies relative to the U.S. dollar, primarily the euro.



The major factors for the changes in operating lease, rental and other revenues,
depreciation and other expenses and lease margin between the six months ended
June 30, 2022 and 2021 are outlined below:

                                         OPERATING
                                     LEASE, RENTAL
                                         AND OTHER             DEPRECIATION       LEASE
($ in millions)                           REVENUES       AND OTHER EXPENSES      MARGIN
Six Months Ended June 30, 2021     $         626.0     $              559.2     $  66.8
(Decrease) increase
Used truck sales                            (145.1 )                 (146.6 )       1.5
Results on returned lease assets                                      (97.2 )      97.2
Average operating lease assets               (16.1 )                  (12.8 )      (3.3 )
Revenue and cost per asset                    12.8                      3.1 

9.7

Currency translation and other               (22.1 )                  (16.8 )      (5.3 )
Total (decrease) increase                   (170.5 )                 (270.3 )      99.8
Six Months Ended June 30, 2022     $         455.5     $              288.9 

$ 166.6

• Lower sales volume of used trucks in Europe and the U.S. decreased revenues by

$145.1 million and related depreciation and other expenses by $146.6 million.

• Results on returned lease assets decreased depreciation and other expenses by

$97.2 million primarily due to higher gains on sales on returned lease units

as a result of higher used truck market values.

• Average operating lease assets decreased $166.1 million (excluding foreign

exchange effects), which decreased revenues by $16.1 million and related

depreciation and other expenses by $12.8 million.

• Revenue per asset increased $12.8 million primarily due to higher rental

utilization. Cost per asset increased $3.1 million due to higher operating

lease depreciation.

• The currency translation effects reflect a decrease in the value of foreign

currencies relative to the U.S. dollar, primarily the euro.

                                     - 43 -
--------------------------------------------------------------------------------




Financial Services SG&A for the second quarter of 2022 decreased to $31.9
million from $32.2 million in the second quarter of 2021 primarily due to
decreases in the value of foreign currencies relative to the U.S. dollar. For
the first six months, Financial Services SG&A increased to $67.6 million in 2022
from $63.4 million in 2021 primarily due to higher salaries and related
expenses, partially offset by decreases in the value of foreign currencies
relative to the U.S. dollar.

As a percentage of revenues, Financial Services SG&A increased to 8.6% in the
second quarter of 2022 from 7.1% in the same period of 2021, and in the first
six months, increased to 9.2% in 2022 from 7.1% in 2021. The increases in both
periods was primarily driven by lower revenues.

The following table summarizes the provision for losses on receivables and net
charge-offs:

                                                  Three Months Ended                    Six Months Ended
                                                    June 30, 2022                         June 30, 2022
                                             PROVISION FOR              NET        PROVISION FOR              NET
                                                 LOSSES ON          CHARGE-            LOSSES ON          CHARGE-
($ in millions)                                RECEIVABLES             OFFS          RECEIVABLES             OFFS
U.S. and Canada                            $           (.4 )     $      (.1 )   $           (2.9 )     $      (.7 )
Europe                                                  .3               .3                   .3               .5
Mexico, Australia and other                            4.5               .2                  7.2              1.3
                                           $           4.4       $       .4     $            4.6       $      1.1



                                                  Three Months Ended                    Six Months Ended
                                                    June 30, 2021                         June 30, 2021
                                             PROVISION FOR              NET       PROVISION FOR               NET
                                                 LOSSES ON          CHARGE-           LOSSES ON           CHARGE-
($ in millions)                                RECEIVABLES             OFFS         RECEIVABLES              OFFS
U.S. and Canada                                                  $       .3     $            .4       $        .6
Europe                                     $           (.8 )             .5                  .2               1.1
Mexico, Australia and other                             .3              1.2                 2.6               2.8
                                           $           (.5 )     $      2.0     $           3.2       $       4.5


The provision for losses on receivables was $4.4 million in the second quarter
of 2022 compared to $(.5) million in 2021, and in the first six months, the
provision for losses on receivables was $4.6 million in 2022 compared to $3.2
million in 2021. The increase in provision for losses in both the second quarter
and first half of 2022 compared to 2021 was mainly driven by portfolio growth
and higher past due balances in Brasil, partially offset by improved portfolio
performance in the U.S. and Canada.

The Company modifies loans and finance leases as a normal part of its Financial
Services operations. The Company may modify loans and finance leases for
commercial reasons or for credit reasons. Modifications for commercial reasons
are changes to contract terms for customers that are not considered to be in
financial difficulty. Insignificant delays are modifications extending terms up
to three months for customers experiencing some short-term financial stress, but
not considered to be in financial difficulty. Modifications for credit reasons
are changes to contract terms for customers considered to be in financial
difficulty. The Company's modifications typically result in granting more time
to pay the contractual amounts owed and charging a fee and interest for the term
of the modification. When considering whether to modify customer accounts for
credit reasons, the Company evaluates the creditworthiness of the customers and
modifies those accounts the Company considers likely to perform under the
modified terms. When the Company modifies a loan or finance lease for credit
reasons and grants a concession, the modification is classified as a troubled
debt restructuring (TDR).

The post-modification balances of accounts modified during the six months ended June 30, 2022 and 2021 are summarized below:


                                     2022                              2021
                            AMORTIZED       % OF TOTAL        AMORTIZED       % OF TOTAL
($ in millions)            COST BASIS       PORTFOLIO*       COST BASIS       PORTFOLIO*
Commercial               $      111.2              2.1 %   $      122.5              2.4 %
Insignificant delay              41.0               .8 %           34.4               .7 %
Credit - no concession           41.0               .8 %           40.0               .8 %
Credit - TDR                      8.1               .2 %            5.7               .1 %
                         $      201.3              3.9 %   $      202.6              4.0 %


* Amortized cost basis immediately after modification as a percentage of ending

retail portfolio, on an annualized basis.

                                     - 44 -
--------------------------------------------------------------------------------




During the first six months of 2022, total modification activity of $201.3
million was comparable to $202.6 million for the same period last year. The
decrease in modifications for Commercial reasons primarily reflects a lower
volume of refinancing. The increase in modifications for Insignificant delay
reflects the impacts of two fleet customers in the U.S. and an increased number
of extensions related to COVID-19 and flooding relief in Australia, partially
offset by a reduction of customers requesting payment relief in Italy related to
the COVID-19 pandemic in the first half of 2021. The slight increase in
modifications for Credit - no concession is primarily due to higher volumes of
refinancing and requests for payment relief in Brasil, partially offset by a
reduction of requests for payment relief in Europe. The increase in
modifications for Credit -TDR is primarily due to contract modifications in
Brasil, partially offset by a reduction of contract modifications related to
COVID-19 for customers in Italy.

The following table summarizes the Company's 30+ days past due accounts:


                                                    June 30       December 

31 June 30

                                                       2022              2021            2021
Percentage of retail loan and lease accounts
30+ days past due:
U.S. and Canada                                                                            .1 %
Europe                                                   .5 %              .4 %            .3 %
Mexico, Australia and other                             1.7 %             1.2 %           1.4 %
Worldwide                                                .4 %              .3 %            .3 %


Accounts 30+ days past due was .4% at June 30, 2022 compared to .3% at December 31, 2021. The Company continues to focus on maintaining low past due balances.


When the Company modifies a 30+ days past due account, the customer is then
generally considered current under the revised contractual terms. The Company
modified $24.7 million of accounts worldwide during the second quarter of 2022,
$.4 million during the fourth quarter of 2021 and $1.0 million during the second
quarter of 2021 that were 30+ days past due and became current at the time of
modification. Had these accounts not been modified and continued to not make
payments, the pro forma percentage of retail loan and lease accounts 30+ days
past due would have been as follows:

                                                    June 30       December 

31 June 30

                                                       2022              2021            2021
Pro forma percentage of retail loan and lease
accounts 30+ days past due:
U.S. and Canada                                                                            .1 %
Europe                                                   .5 %              .4 %            .3 %
Mexico, Australia and other                             2.9 %             1.2 %           1.4 %
Worldwide                                                .6 %              .3 %            .3 %

Modifications of accounts in prior quarters that were more than 30 days past due at the time of modification are included in past dues if they were not performing under the modified terms at June 30, 2022, December 31, 2021 and June 30, 2021. The effect on the allowance for credit losses from such modifications was not significant at June 30, 2022, December 31, 2021 and June 30, 2021.


The Company's annualized pre-tax return on average assets for Financial Services
increased to 3.6% in the second quarter of 2022 from 2.7% in the same period of
2021, and in the first six months, increased to 3.7% in 2022 from 2.4% in 2021.
The increase in both periods was primarily driven by improved used truck
results.

Other


Other includes the winch business as well as sales, income and expenses not
attributable to a reportable segment. Other also includes non-service cost
components of pension expense and a portion of corporate expense. Other sales
represent less than 1% of consolidated net sales and revenues for both the
second quarter and first half of 2022 and 2021. Other SG&A increased to $22.9
million for the second quarter of 2022 from $15.3 million for the second quarter
of 2021 and increased to $42.6 million for the first half of 2022 from $32.4
million for the first half of 2021. The increase in both periods was primarily
due to higher salaries and related expenses.

For the second quarter, Other (loss) income before income taxes was ($3.1)
million compared to $5.5 million in 2021. For the first six months, Other income
before tax was $6.9 million compared to $10.9 million in 2021. The decrease in
both periods is primarily due to higher salaries and related expenses, partially
offset by higher benefit from non-service components of pension expense.

Investment income for the second quarter increased to $5.4 million in 2022 from
$5.0 million in 2021. For the first six months, investment income decreased to
$2.9 million in 2022 from $9.9 million in 2021. For the second quarter and first
six months of 2022 investment income from marketable debt securities was higher
compared to the same periods in 2021 due to higher yields on South America and
U.S. investments, partially offset by unrealized losses on marketable equity
securities.

                                     - 45 -
--------------------------------------------------------------------------------

Income Taxes


The effective tax rate for the second quarter of 2022 was 21.9% compared to
22.6% for the second quarter of 2021. The effective tax rate for the first six
months of 2022 was 22.0% compared to 22.6% for the first six months of 2021. The
lower effective tax rate in the second quarter and first half of 2022 was
primarily due to the change in mix of income generated in jurisdictions with
lower tax rates in 2022 as compared to 2021.

                                        Three Months Ended           Six Months Ended
                                              June 30                     June 30
($ in millions)                             2022         2021          2022          2021
Domestic income before taxes          $    568.4      $ 393.9     $ 1,042.4     $   779.6
Foreign income before taxes                353.7        246.4         651.1         469.0
Total income before taxes             $    922.1      $ 640.3     $ 1,693.5     $ 1,248.6
Domestic pre-tax return on revenues         14.3 %       12.3 %        14.2 %        12.4 %
Foreign pre-tax return on revenues          11.2 %        9.3 %        10.4 %         8.7 %
Total pre-tax return on revenues            12.9 %       11.0 %        12.4 

% 10.7 %




For the second quarter and first half of 2022, both domestic and foreign income
before income taxes and pre-tax return on revenues increased primarily due to
the improved results from Truck, Parts and Financial Services operations.

LIQUIDITY AND CAPITAL RESOURCES:

                            June 30       December 31
($ in millions)                2022              2021
Cash and cash equivalents $ 3,231.3     $     3,428.3
Marketable securities       1,559.2           1,559.4
                          $ 4,790.5     $     4,987.7



The Company's total cash and marketable securities at June 30, 2022 decreased
$197.2 million from the balances at December 31, 2021. Total cash and marketable
securities are primarily intended to provide liquidity while preserving capital.

The change in cash and cash equivalents is summarized below:

($ in millions)
Six Months Ended June 30,                                         2022          2021
Operating activities:
Net income                                                   $ 1,320.9     $   966.3
Net income items not affecting cash                              229.2      

434.9

Changes in operating assets and liabilities, net                (452.6 )      (533.5 )
Net cash provided by operating activities                      1,097.5      

867.7

Net cash used in investing activities                           (879.0 )      (666.7 )
Net cash used in financing activities                           (346.0 )      (651.5 )
Effect of exchange rate changes on cash and cash equivalents     (69.5 )       (19.3 )
Net decrease in cash and cash equivalents                       (197.0 )      (469.8 )
Cash and cash equivalents at beginning of period               3,428.3      

3,539.6

Cash and cash equivalents at end of period                   $ 3,231.3     

$ 3,069.8




Operating activities: Cash provided by operations increased by $229.8 million to
$1,097.5 million in the first half of 2022 from $867.7 million in 2021. Higher
operating cash flows reflect lower cash usage of $535.4 million for inventories,
higher net income of $354.6 million and lower cash outflow for payment of income
taxes of $80.9 million. Additionally, higher operating cash flows reflect lower
cash outflows of $79.3 million for accounts payable and accrued expenses as
purchases of goods and services exceeded payments. The higher operating cash
flows were partially offset by $733.8 million in wholesale receivables in the
Financial Services segment primarily due to increasing wholesale receivables,
and lower cash receipts from trade and other receivables of $105.3 million.

                                     - 46 -
--------------------------------------------------------------------------------



Investing activities: Cash used in investing activities increased by $212.3
million to $879.0 million in the first half of 2022 from $666.7 million in 2021.
Higher net cash used in investing activities reflects lower proceeds from asset
disposals of $125.1 million, higher net cash used in investing activities of
$73.6 million and higher net originations of loans and financing leases of $69.3
million. The higher net cash usage was partially offset by fewer acquisitions of
equipment for operating leases of $78.5 million.

Financing activities: Cash used in financing activities decreased by $305.5 to
$346.0 million in the first half of 2022 from $651.5 in 2021. In the first half
of 2022, cash provided by net borrowing activities in 2022 was $395.1 million,
$603.5 million higher than the cash used by net borrowing activities of $208.4
million in 2021. The Company paid $757.6 million in dividends in 2022 compared
to $471.8 million in 2021 due to a higher year-end dividend paid in January
2022.

Credit Lines and Other


The Company has line of credit arrangements of $3.67 billion, of which $3.41
billion were unused at June 30, 2022. Included in these arrangements are $3.00
billion of committed bank facilities, of which $1.00 billion expires in
June 2023, $1.00 billion expires in June 2025 and $1.00 billion expires in
June 2027. The Company intends to extend or replace these credit facilities on
or before expiration to maintain facilities of similar amounts and duration.
These credit facilities are maintained primarily to provide backup liquidity for
commercial paper borrowings and maturing medium-term notes. There were no
borrowings under the committed bank facilities for the six months ended June 30,
2022.

On December 4, 2018, PACCAR's Board of Directors approved the repurchase of up to $500.0 million of the Company's outstanding common stock. As of June 30, 2022, the Company has repurchased $110.0 million of shares under this plan. There were no repurchases made under this plan during the second quarter of 2022.

Truck, Parts and Other


The Company provides funding for working capital, capital expenditures, R&D,
dividends, stock repurchases and other business initiatives and commitments
primarily from cash provided by operations. Management expects this method of
funding to continue in the future.

Investments for manufacturing property, plant and equipment in the first six
months of 2022 were $227.4 million compared to $207.2 million for the same
period of 2021. Over the past decade, the Company's combined investments in
worldwide capital projects and R&D totaled $7.21 billion and have significantly
increased the operating capacity and efficiency of its facilities and enhanced
the quality and operating efficiency of the Company's premium products.

In 2022, total capital investments for PACCAR are expected to be $425 to $475
million and R&D is expected to be $330 to $350 million. The Company is
increasing its investment in clean diesel and electric powertrain technologies,
autonomous systems, connected vehicle services, next-generation manufacturing
and parts distribution capabilities.

Financial Services


The Company funds its financial services activities primarily from collections
on existing finance receivables and borrowings in the capital markets. The
primary sources of borrowings in the capital markets are commercial paper and
medium-term notes issued in the public markets and, to a lesser extent, bank
loans.

In November 2021, the Company's U.S. finance subsidiary, PACCAR Financial Corp.
(PFC), filed a shelf registration under the Securities Act of 1933. The total
amount of medium-term notes outstanding for PFC as of June 30, 2022 was $5.70
billion. The registration expires in November 2024 and does not limit the
principal amount of debt securities that may be issued during that period.

As of June 30, 2022, the Company's European finance subsidiary, PACCAR Financial
Europe, had €1.61 billion available for issuance under a €2.50 billion
medium-term note program listed on the Euro MTF Market of the Luxembourg Stock
Exchange. This program has been renewed through the filing of a new listing,
which expires in July 2023.

In August 2021, PACCAR Financial Mexico registered a 10.00 billion Mexican peso
program with the Comision Nacional Bancaria y de Valores to issue medium-term
notes and commercial paper. The registration expires in August 2026 and limits
the amount of Commercial paper (up to one year) to 5.00 billion Mexican pesos.
At June 30, 2022, 9.39 billion Mexican pesos were available for issuance.

In August 2018, the Company's Australian subsidiary, PACCAR Financial Pty. Ltd.
(PFPL), established a medium-term note program. The program does not limit the
principal amount of debt securities that may be issued under the program. The
total amount of medium-term notes outstanding for PFPL as of June 30, 2022 was
850.0 million Australian dollars.

                                     - 47 -
--------------------------------------------------------------------------------



In May 2021, the Company's Canadian subsidiary, PACCAR Financial Ltd. (PFL
Canada), established a medium-term note program. The program does not limit the
principal amount of debt securities that may be issued under the program. The
total amount of medium-term notes outstanding for PFL Canada as of June 30, 2022
was 150.0 million Canadian dollars.

The Company believes its cash balances and investments, collections on existing
finance receivables, committed bank facilities and current investment-grade
credit ratings of A+/A1 will continue to provide it with sufficient resources
and access to capital markets at competitive interest rates and therefore
contribute to the Company maintaining its liquidity and financial stability. In
the event of a decrease in the Company's credit ratings or a disruption in the
financial markets, the Company may not be able to refinance its maturing debt in
the financial markets. In such circumstances, the Company would be exposed to
liquidity risk to the degree that the timing of debt maturities differs from the
timing of receivable collections from customers. The Company believes its
various sources of liquidity, including committed bank facilities, would
continue to provide it with sufficient funding resources to service its maturing
debt obligations.

FORWARD-LOOKING STATEMENTS:

This report contains "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Forward-looking statements
include statements relating to future results of operations or financial
position and any other statement that does not relate to any historical or
current fact. Such statements are based on currently available operating,
financial and other information and are subject to risks and uncertainties that
may affect actual results. Risks and uncertainties include, but are not limited
to: a significant decline in industry sales; competitive pressures; reduced
market share; reduced availability of or higher prices for fuel; increased
safety, emissions or other regulations or tariffs resulting in higher costs
and/or sales restrictions; currency or commodity price fluctuations; lower used
truck prices; insufficient or under-utilization of manufacturing capacity;
supplier interruptions; insufficient liquidity in the capital markets;
fluctuations in interest rates; changes in the levels of the Financial Services
segment new business volume due to unit fluctuations in new PACCAR truck sales
or reduced market shares; changes affecting the profitability of truck owners
and operators; price changes impacting truck sales prices and residual values;
insufficient supplier capacity or access to raw materials and components,
including semiconductors; labor disruptions; shortages of commercial truck
drivers; increased warranty costs; pandemics; global conflicts; litigation,
including EC settlement-related claims; or legislative and governmental
regulations. A more detailed description of these and other risks is included
under the headings Part I, Item 1A, "Risk Factors" in the Company's Annual
Report on Form 10­K for the year ended December 31, 2021 and in Part II, Item 1,
"Legal Proceedings" and Part II, Item 1A, "Risk Factors" of this Quarterly
Report on Form 10-Q.

                                     - 48 -

--------------------------------------------------------------------------------

© Edgar Online, source Glimpses

All news about PACCAR, INC.
09/13PACCAR Raises Quarterly Dividend by 9% to $0.37 Per Share, Payable on Dec. 6 to Shareho..
MT
09/13PACCAR Increases Regular Quarterly Dividend
BU
09/13PACCAR Inc Increases Regular Quarterly Dividend, Payable on December 6, 2022
CI
08/18North American Morning Briefing: Stock Futures -2-
DJ
08/17Vertical Research Downgrades PACCAR to Hold From Buy
MT
08/16PACCAR, INC. : Ex-dividend day for
FA
08/15PACCAR to Offer Cummins X15N Natural Gas Engine
BU
08/12North American Morning Briefing: Stock Futures -2-
DJ
08/11Evercore ISI Downgrades PACCAR to In-Line From Outperform
MT
08/05Paccar : ESG Report
PU
More news
Analyst Recommendations on PACCAR, INC.
More recommendations