PACCAR INC
For the period ended Dec 31, 2025. Filed Feb 18, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Feb 18, 2026
PCAR$101.98-2.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-02-19.
0000950170-25-023145
Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-K
Period ended 2025-12-31; filed 2026-02-18.
0001193125-26-057025
Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 147 previous paragraphs and 160 current paragraphs.
57 unchanged; 80 reworded; 23 added; 10 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 20 previous and 21 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (23)
Current report
and Europe.
Current report
Adjusted net income (non-GAAP), excluding a $264.5 million after-tax charge related to civil litigation in Europe, was $2.64 billion ($5.01 per diluted share). After-tax return on beginning equity (ROE) was 13.6% in 2025, which includes the $264.5 million after-tax charge related to civil litigation in Europe in the first quarter of this year. Excluding the after-tax charge, adjusted ROE (non-GAAP) was 15.1%. This compares to an ROE of 26.2% in 2024. See Reconciliation of GAAP to Non-GAAP Financial Measures on page 31.
Current report
Kenworth constructed a 46,000 square-foot robotic chassis paint facility in Chillicothe, Ohio. PACCAR also completed a new $35 million, 50,000 square-foot engine remanufacturing facility and is enhancing its existing engine factory in Columbus, Mississippi. PACCAR is also enhancing its other engine facility in the Netherlands. PACCAR opened a new 180,000 square-foot Parts Distribution Center (PDC) in Calgary, Canada, to enhance parts delivery to dealers and customers in the region.
Current report
The Company's truck and parts products have been negatively affected since March 2025 by import tariffs imposed by the U.S. government and actions taken by other countries. While the Company has taken mitigating actions to reduce the impact, the ongoing impact from import tariffs on truck order intake and profit margins remains unfavorable. The Company's North American truck factories are optimally located to operate under the new Section 232 truck tariffs that began in November 2025. The Company’s tariff exposure is minimized by producing trucks locally for the United States, Canada and Mexico. The Company manufactures its trucks for U.S. customers in its Ohio, Texas, and Washington state factories.
Current report
The recent U.S. Environmental Protection Agency announcement reaffirmed the EPA27 NOx limit and could eliminate changes to extended warranty requirements and useful life requirements on new emissions systems. The Company's results could be impacted by changes in tariff policy, including the expected U.S. Supreme Court ruling on the International Emergency Economic Power Acts (IEEPA) tariffs, emissions regulations and improving freight fundamentals.
Current report
Average truck sales prices decreased sales by $306.2 million, primarily due to lower price realization in the U.S. and Canada and Europe, reflecting an increased competitive environment, partially offset by tariff price increases in the U.S.
Current report
Average cost per truck increased cost of sales by $962.2 million, primarily reflecting higher regulatory and other truck content, increased tariff costs and product support accruals.
Current report
costs and factory supplies from lower truck build rates.
Current report
Aftermarket parts sales volume decreased by $143.1 million and related cost of sales decreased by $69.6 million. The
Current report
decrease in parts sales and costs reflects lower sales volume, primarily Europe and Mexico.
Current report
primarily in the U.S.
Current report
expense.
Current report
The currency translation effects reflect an increase in the value of foreign currencies relative to the U.S. dollar, primarily the euro.
Current report
The provision for losses on receivables increased to $124.5 million in 2025 from $75.6 million in 2024, primarily due to a higher provision in Brasil and the U.S., reflecting an increase in 30+ days past due accounts and growth in retail portfolios. Net charge-offs increased to $85.0 million in 2025 from $53.5 million in 2024. The increased charge-offs in the U.S. and Canada were driven by a soft truckload market and included several large fleet customers, which were provisioned for previously. Higher charge-offs in Brasil reflected a decline in market conditions, including elevated interest rates.
Current report
Investment income decreased to $346.1 million in 2025 from $394.7 million in 2024, primarily due to lower investment yields from lower market interest rates in the U.S. and Europe, partially offset by an increase in average investment balance, primarily in the U.S.
Current report
In 2025, the effective tax rate was 21.4% compared to 22.9% in 2024, primarily reflecting higher U.S. federal R&D tax credits. Excluding the $350.0 million EC charge and its associated tax benefit, the adjusted 2025 effective tax rate (non-GAAP) was 21.7%.
Current report
Capital investments in 2026 are expected to be $725 to $775 million, and R&D is expected to be $450 to $500 million. PACCAR is investing in next generation clean diesel and alternative powertrains, electric battery cells, integrated connected vehicle services, flexible manufacturing capabilities, and autonomous and advanced driver assistance systems, that create value for customers. In addition to the capital and R&D investments, the Company expects to continue investing in its U.S.-based battery joint venture, Amplify Cell Technologies.
Current report
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES:
Current report
This Form 10-K includes “adjusted net income (non-GAAP)” and “adjusted net income per diluted share (non-GAAP)”, which are financial measures that are not in accordance with U.S. generally accepted accounting principles (“GAAP”), since they exclude a charge for EC-related claims. These measures differ from the most directly comparable measures calculated in accordance with GAAP and may not be comparable to similarly titled non-GAAP financial measures used by other companies. In addition, the Form 10-K includes the financial ratios noted below calculated on non-GAAP measures.
Current report
Adjustment for the EC-related claims relates to a pre-tax charge of $350.0 million ($264.5 million after-tax) for estimable total costs recorded in Interest and other expenses (income), net in the first quarter 2025.
Current report
The Company utilizes these non-GAAP measures to allow investors and management to evaluate operating trends by excluding
Current report
a significant charge that is not representative of company performance.
Current report
Reconciliations from the most directly comparable GAAP measures to adjusted net income (non-GAAP) and adjusted net income per diluted shares (non-GAAP) are as follows:
Removed paragraphs (10)
Previous report
After-tax return on beginning equity (ROE) was 26.2% in 2024 compared to 34.9% in 2023. Equity increased 10.3% from $15.88 billion in 2023 to a record $17.51 billion in 2024.
Previous report
PACCAR opened its new, 240,000 square-foot Parts Distribution Center (PDC) in Massbach, Germany, in November 2024. This PDC supports DAF’s growth in Germany, Europe’s largest truck market, by enhancing parts delivery to dealers and customers.
Previous report
The Company’s new truck deliveries are summarized below:
Previous report
Average truck sales prices increased sales by $155.6 million from modest price realization, primarily in the U.S. and Canada, Mexico and Australia.
Previous report
Average cost per truck increased cost of sales by $557.1 million, primarily reflecting higher raw material and labor costs, partially offset by lower warranty costs.
Previous report
Aftermarket parts sales volume increased by $89.8 million and related cost of sales increased by $81.2 million, primarily reflecting higher sales volume in all markets except the U.S. and Canada.
Previous report
The provision for losses on receivables increased to $75.6 million in 2024 from $31.3 million in 2023, primarily driven by portfolio growth, an increase in the Company’s 30+ past due accounts and higher charge-offs in the U.S. and Canada and Europe. The increased charge-offs in 2024 included three large fleet customers in the U.S. and Canada and two large fleet customers in Europe. The higher charge-offs in 2024 also reflected higher average loss severity in all markets from lower used truck market values.
Previous report
Investment income increased to $394.7 million in 2024 from $292.2 million in 2023, primarily due to higher average investment balances in all regions as well as higher investment yields due to higher market interest rates, primarily in the U.S. and Europe.
Previous report
In 2024, the effective tax rate was 22.9% compared to 19.5% in 2023. The lower effective tax rate in 2023 was primarily due to a $119.7 million discrete tax benefit for the release of a valuation allowance on deferred tax assets in Brasil. Also included in 2023 was the EC-related charge of $600.0 million, which lowered the effective tax rate in 2023.
Previous report
Capital investments in 2025 are expected to be $700 to $800 million, and R&D is expected to be $460 to $500 million. PACCAR is investing in its truck factories, including expansions at Kenworth Chillicothe, Ohio, PACCAR Mexico, and the DAF truck assembly plant in Eindhoven, Netherlands. Investments in PACCAR's global engine business include additional manufacturing and remanufacturing capacity. In addition to the capital and R&D investments, the Company expects to invest another $400 to $700 million in its battery joint venture, Amplify Cell Technologies.
Reworded paragraphs (80)
Previous wording
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 the U.S. and Canada, trucks are sold under the Kenworth and Peterbilt nameplates, in Europe, under the DAF nameplate and in Mexico, 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 included the manufacturing and marketing of industrial winches through October 31, 2024, when PACCAR sold its industrial winch business.
Current wording
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 the U.S. and Canada, trucks are sold under the Kenworth and Peterbilt nameplates, in Europe, under the DAF nameplate and in Mexico, 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.
Previous wording
Worldwide net sales and revenues were $33.66 billion in 2024 compared to $35.13 billion in 2023, primarily due to lower truck revenues, partially offset by higher parts and financial services revenues.
Current wording
Worldwide net sales and revenues were $28.44 billion in 2025 compared to $33.66 billion in 2024, primarily due to lower truck revenues, partially offset by higher parts and financial services revenues.
Previous wording
Truck sales were $24.84 billion in 2024 compared to $26.85 billion in 2023 from lower revenues in Europe and the U.S. and Canada.
Current wording
Truck sales were $19.37 billion in 2025 compared to $24.84 billion in 2024 due to lower truck deliveries in all major markets.
Previous wording
Parts sales were $6.67 billion in 2024 compared to $6.41 billion in 2023, reflecting higher price realization in all markets.
Current wording
Parts sales were $6.87 billion in 2025 compared to $6.67 billion in 2024, reflecting higher sales in the U.S. and Canada
Previous wording
Financial Services revenues were $2.10 billion in 2024 compared to $1.81 billion in 2023, primarily due to portfolio growth and higher portfolio yields.
Current wording
Financial Services revenues were $2.21 billion in 2025 compared to $2.10 billion in 2024, primarily due to higher interest income driven by retail portfolio growth and higher portfolio yields.
Previous wording
In 2024, PACCAR earned net income for the 86 th consecutive year. Net income was $4.16 billion ($7.90 per diluted share) in 2024 compared to $4.60 billion ($8.76 per diluted share) in 2023.
Current wording
In 2025, PACCAR earned net income for the 87 th consecutive year. Net income was $2.38 billion ($4.51 per diluted share) in 2025 compared to $4.16 billion ($7.90 per diluted share) in 2024.
Previous wording
Capital investments were $795.8 million in 2024 compared to $698.3 million in 2023.
Current wording
Capital investments were $728.5 million in 2025 compared to $795.8 million in 2024.
Previous wording
Research and development (R&D) expenses were $452.9 million in 2024 compared to $410.9 million in 2023.
Current wording
Research and development (R&D) expenses were $445.5 million in 2025 compared to $452.9 million in 2024.
Previous wording
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 $22.41 billion. PFS issued $3.65 billion in medium-term notes during 2024 to support new business volume and repay maturing debt.
Current wording
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 $22.80 billion. PFS issued $3.12 billion in medium-term notes during 2025 to support new business volume and market share growth and repay maturing debt.
Previous wording
Truck industry heavy-duty retail sales in the U.S. and Canada in 2025 are expected to be 250,000 to 280,000 units compared to 268,100 in 2024. In Europe, the 2025 truck industry registrations for over 16-tonne vehicles are expected to be 270,000 to 300,000 units compared to 316,100 in 2024. In South America, heavy-duty truck industry registrations in 2025 are projected to be 115,000 to 125,000 compared to 119,000 in 2024.
Current wording
Truck industry heavy-duty retail sales in the U.S. and Canada in 2026 are expected to be 230,000 to 270,000 units compared to 232,800 in 2025. In Europe, the 2026 truck industry registrations for over 16-tonne vehicles are expected to be 280,000 to 320,000 units compared to 297,000 in 2025. In South America, heavy-duty truck industry registrations in 2026 are projected to be 100,000 to 110,000 compared to 115,000 in 2025.
Previous wording
In 2025, PACCAR Parts sales are expected to increase 2-4% compared to 2024, depending on the economic conditions.
Current wording
In 2026, PACCAR Parts sales are expected to increase 4-8% compared to 2025, depending on the economic conditions.
Previous wording
In 2025, average earning assets are expected to be comparable to 2024. The used truck market has normalized in North America, but remains soft in Europe. If freight transportation conditions decline due to a weaker economy, then past due accounts, truck repossessions and credit losses would likely increase from the current levels and new business volume would likely decline.
Current wording
In 2026, average earning assets are expected to be comparable to 2025. The used truck market has been improving, which is reflected in PFS' quarterly results this year. If freight transportation conditions decline due to a weaker economy, then past due accounts, truck repossessions and credit losses would likely increase from the current levels and new business volume and average earning assets would likely decline.
Previous wording
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 expanded facilities, innovative products and new technologies during the past decade. Capital investments in 2025 are expected to be $700 to $800 million, and R&D is expected to be $460 to $500 million. PACCAR is investing in its truck factories, including expansions at Kenworth Chillicothe, Ohio, PACCAR Mexico, and the DAF truck assembly plant in Eindhoven, Netherlands. Investments in PACCAR's global engine business include additional manufacturing and remanufacturing capacity. In addition to the capital and R&D investments, the Company expects to invest another $400 to $700 million in its battery joint venture, Amplify Cell Technologies.
Current wording
PACCAR's excellent long-term profits, strong balance sheet and consistent focus on quality have enabled the Company to invest $9.2 billion in new and expanded facilities, innovative products and new technologies during the past decade. Capital investments in 2026 are expected to be $725 to $775 million, and R&D is expected to be $450 to $500 million. PACCAR is investing in next generation clean diesel and alternative powertrains, integrated connected vehicle services, flexible manufacturing capabilities and autonomous and advanced driver assistance systems that create value for customers. The Company is embedding artificial intelligence across its business to drive innovation, profitable growth and enhanced performance for the Company's customers. In addition to the capital and R&D investments, the Company expects to continue investing in its U.S.-based battery joint venture, Amplify Cell Technologies.
Previous wording
In 2023, Other includes a $600.0 million non-recurring charge related to civil litigation in Europe (EC-related claims) in the first quarter 2023. In 2024, Other includes a $14.0 million gain on sale of the winch business.
Current wording
In 2025, Other includes a $350.0 million charge related to civil litigation in Europe (EC-related claims) in the first quarter 2025. In 2024, Other includes a $14.0 million gain on sale of the winch business.
Previous wording
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 and economic conditions affecting the Company’s results of operations.
Current wording
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 and impact from tariffs, fuel prices, freight tonnage and economic conditions affecting the Company’s results of operations.
Previous wording
The Company’s Truck segment accounted for 74% of revenues in 2024 compared to 77% in 2023.
Current wording
The Company’s Truck segment accounted for 68% of revenues in 2025 compared to 74% in 2024.
Previous wording
Worldwide new truck deliveries decreased in 2024 compared to 2023, primarily due to lower deliveries in Europe.
Current wording
Worldwide new truck deliveries decreased in 2025 compared to 2024, reflecting lower retail demand in all major markets.
Previous wording
In 2024, industry retail sales in the heavy-duty market in the U.S. and Canada decreased to 268,100 units from 297,000 units in 2023. The Company’s heavy-duty truck retail market share was 30.7% in 2024 compared to 29.5% in 2023. The medium-duty market was 110,400 units in 2024 compared to 105,300 units in 2023. The Company’s medium-duty market share was 18.0% in 2024 compared to 14.5% in 2023.
Current wording
In 2025, industry retail sales in the heavy-duty market in the U.S. and Canada was 232,800 units compared to 268,100 units in 2024. The Company’s heavy-duty truck retail market share was 29.9% in 2025 compared to 30.7% in 2024. The medium-duty market was 88,400 units in 2025 compared to 110,400 units in 2024. The Company’s medium-duty market share was 15.9% in 2025 compared to 18.0% in 2024.
Previous wording
The over 16‑tonne truck market in Europe in 2024 decreased to 316,100 units from 343,300 units in 2023, and DAF’s market share was 14.4% in 2024 compared to 15.6% in 2023. The 6 to 16‑tonne market was 50,900 units in 2024 and 46,800 units in 2023. DAF’s market share in the 6 to 16-tonne market in 2024 was 9.5% compared to 9.1% in 2023.
Current wording
The over 16-tonne truck market in Europe in 2025 decreased to 297,000 units from 316,100 units in 2024, and DAF’s market share was 13.5% in 2025 compared to 14.4% in 2024. The 6 to 16-tonne market was 40,900 units in 2025 and 50,900 units in 2024. DAF’s market share in the 6 to 16-tonne market in 2025 was 9.7% compared to 9.5% in 2024.
Previous wording
The over 16‑tonne truck market in Brasil in 2024 increased to 97,700 units from 82,100 units in 2023, and DAF Brasil's market share was 9.9% in 2024 compared to 10.2% in 2023.
Current wording
The over 16-tonne truck market in Brasil in 2025 was 86,700 units compared to 97,700 units in 2024, and DAF Brasil's market share was 8.6% in 2025 compared to 9.9% in 2024.
Previous wording
The Company’s worldwide truck net sales and revenues decreased to $24.84 billion in 2024 from $26.85 billion in 2023 primarily due to lower truck deliveries in Europe. Truck segment income before income taxes and pre-tax return on revenues decreased primarily due to lower truck unit deliveries in Europe and the U.S. and Canada, partially offset by higher truck unit deliveries in Mexico and South America.
Current wording
The Company’s worldwide truck net sales and revenues decreased to $19.37 billion in 2025 from $24.84 billion in 2024 primarily due to lower truck unit deliveries in all major markets from lower retail demand. Truck segment income before income taxes and pre-tax return on revenues decreased primarily due to lower truck unit deliveries in all major markets from lower retail demand, reflecting economic conditions as well as higher tariff costs resulting from current trade policies primarily in the U.S.
Previous wording
Truck sales volume decreased revenues by $2,107.6 million and costs by $1,650.0 million, primarily reflecting lower truck deliveries in Europe and the U.S. and Canada, partially offset by higher truck deliveries in Mexico and Brasil.
Current wording
Truck sales volume decreased revenues by $5,333.6 million and costs by $4,489.9 million, primarily reflecting lower truck deliveries in all major markets.
Previous wording
Factory overhead and other indirect costs increased $18.6 million, primarily due to higher labor costs, primarily offset by lower utilities costs and factory supplies.
Current wording
Factory overhead and other indirect costs decreased $188.6 million, primarily due to lower labor costs, maintenance
Previous wording
Extended warranties, operating leases and other increased revenues by $61.5 million primarily due to higher volume of repair and maintenance (R&M) contracts, extended warranty and dealer support services. The increase in cost of sales by $106.3 million reflects higher costs from extended warranty, R&M contracts, dealer support services and lower used truck results.
Current wording
Extended warranties, operating leases and other increased revenues by $41.2 million primarily due to a higher portfolio of extended warranty and repair and maintenance (R&M) contracts and higher dealer support services. The increase in cost of sales of $80.0 million reflects the higher warranty and R&M contracts and higher used truck costs, primarily in Europe.
Previous wording
The currency translation effect on sales and cost of sales primarily reflects a decrease in the value of the Brazilian real, Canadian dollar and Australian dollar relative to the U.S. dollar, partially offset by an increase in the value of the euro relative to the U.S. dollar.
Current wording
The currency translation effect on sales and cost of sales primarily reflects an increase in the value of the euro relative to the U.S. dollar, partially offset by the decrease in value of the Brazilian real, Canadian dollar and Australian dollar relative to the U.S. dollar.
Previous wording
Truck gross margin was 13.9% in 2024 compared to 16.4% in 2023 due to the factors noted above.
Current wording
Truck gross margin was 7.5% in 2025 compared to 13.9% in 2024 due to the factors noted above.
Previous wording
Truck selling, general and administrative (SG&A) expenses in 2024 decreased to $254.2 million from $278.5 million in 2023. The decrease was primarily due to lower sales and marketing expenses and professional expenses. As a percentage of sales, Truck SG&A was 1.0% in 2024 and 1.0% in 2023.
Current wording
Truck SG&A expenses in 2025 decreased to $237.7 million from $254.2 million in 2024. The decrease was primarily due to lower salaries and related expenses, lower professional fees and lower travel and entertainment expenses, partially offset by higher sales and marketing expenses. As a percentage of sales, Truck SG&A was 1.2% in 2025 and 1.0% in 2024.
Previous wording
The Company’s Parts segment accounted for 20% of revenues in 2024 compared to 18% in 2023.
Current wording
The Company’s Parts segment accounted for 24% of revenues in 2025 compared to 20% in 2024.
Previous wording
The Company’s worldwide parts net sales and revenues increased to $6.67 billion in 2024 from $6.41 billion in 2023 primarily due to higher sales in all markets.
Current wording
The Company’s worldwide parts net sales and revenues increased to $6.87 billion in 2025 from $6.67 billion in 2024 primarily due to higher sales in the U.S. and Canada and Europe.
Previous wording
Average aftermarket parts sales prices increased sales by $161.6 million, primarily due to price realization in Europe and the U.S. and Canada.
Current wording
Average aftermarket parts sales prices increased sales by $307.3 million, primarily due to price realization in the U.S. and Canada as well as tariff cost increases in the U.S.
Previous wording
Average aftermarket parts direct costs increased $143.9 million due to higher material costs, primarily in the U.S. and Europe, and higher delivery costs.
Current wording
Average aftermarket parts direct costs increased $213.7 million due to higher material costs and higher tariff costs,
Previous wording
Warehouse and other indirect costs increased $14.2 million primarily due to higher salaries and related expenses.
Current wording
Warehouse and other indirect costs increased $46.1 million, primarily due to higher indirect costs, including depreciation
Previous wording
The currency translation effect on sales and cost of sales primarily reflects a decline in the value of the Brazilian real, Canadian dollar, Mexican peso and Australian dollar relative to the U.S. dollar, partially offset by the increase in value of the euro relative to the U.S. dollar.
Current wording
The currency translation effect on sales and cost of sales primarily reflects an increase in the value of the euro relative to the U.S. dollar, partially offset by a decrease in the value of the Australian dollar and Canadian dollar relative to the U.S. dollar.
Previous wording
Parts gross margin was 30.9% in 2024 compared to 31.9% in 2023 due to the factors noted above.
Current wording
Parts gross margin was 29.9% in 2025 compared to 30.9% in 2024 due to the factors noted above.
Previous wording
Parts SG&A expense in 2024 increased to $246.4 million from $238.0 million in 2023. The increase was primarily due to higher salaries and related expenses, partially offset by lower sales and marketing costs. As a percentage of sales, Parts SG&A was 3.7% in 2024 and 3.7% in 2023.
Current wording
Parts SG&A expense in 2025 increased to $257.8 million from $246.4 million in 2024. The increase was primarily due to higher salaries and related expenses. As a percentage of sales, Parts SG&A was 3.8% in 2025 and 3.7% in 2024.
Previous wording
The Company’s Financial Services segment accounted for 6% of revenues in 2024 compared to 5% in 2023.
Current wording
The Company’s Financial Services segment accounted for 8% of revenues in 2025 compared to 6% in 2024.
Previous wording
New loan and lease volume increased to a record $7.50 billion in 2024 from $7.21 billion in 2023. The increase in new loan and finance lease volume reflected higher finance market share of new PACCAR truck sales, primarily in the U.S. and Canada and Brasil. The increase in equipment on operating lease volume reflected higher market demand and a higher amount financed per truck in all major markets. The effect of currency translation decreased new loan and lease volume by $85.7 million, primarily due to a decrease in the value of the Brazilian real and Mexican peso relative to the U.S. dollar. PFS finance market share of new PACCAR truck sales was 25.0% in 2024 compared to 24.0% in 2023.
Current wording
New loan and lease volume was $6.88 billion in 2025 compared to $7.50 billion in 2024. The decrease in new loan and finance lease volume was primarily due to lower new loan and lease volume from lower retail sales of PACCAR trucks and currency translation effects, partly offset by higher finance market share of new PACCAR truck sales. PFS finance market share of new PACCAR truck sales was 27.0% in 2025 compared to 25.0% in 2024, reflecting higher shares in all markets. The decrease in equipment on operating lease volume was primarily due to lower market demand in the U.S. and Canada and Mexico. The effect of currency translation decreased new loan and lease volume by $28.3 million, primarily due to a decrease in the value of the Mexican peso and Brazilian real relative to the U.S. dollar, partially offset by an increase in the value of the euro relative to the U.S. dollar.
Previous wording
PFS revenues increased to $2.10 billion in 2024 from $1.81 billion in 2023. The increase was primarily driven by portfolio growth in all markets except Europe. The effects of currency translation decreased PFS revenues by $23.5 million in 2024, primarily due to a decrease in the value of foreign currencies relative to the U.S. dollar, primarily the Brazilian real and Mexican peso.
Current wording
PFS revenues increased to $2.21 billion in 2025 from $2.10 billion in 2024. The increase was primarily driven by portfolio growth in all markets except Europe. The effects of currency translation decreased PFS revenues by $9.9 million in 2025, primarily due to a decrease in the value of the Mexican peso and Brazilian real relative to the U.S. dollar, partially offset by an increase in the value of the euro relative to the U.S. dollar.
Previous wording
PFS income before income taxes decreased to $435.6 million in 2024 from $540.3 million in 2023, primarily due to lower operating lease margins, reflecting lower results on returned lease assets, partially offset by higher finance margins from a higher asset portfolio and higher portfolio yields. The effect of currency translation decreased PFS income before income taxes by $8.7 million in 2024, primarily due to a decrease in the value of the Brazilian real and Mexican peso relative to the U.S. dollar.
Current wording
PFS income before income taxes increased to $485.4 million in 2025 from $435.6 million in 2024, due to higher finance margins from a higher loan and finance lease portfolio, and higher operating lease margins from operating lease portfolio, partially offset by a higher provision for losses on receivables. The effect of currency translation decreased PFS income before income taxes by $13.2 million in 2025, primarily due to a decrease in the value of the Mexican peso and Brazilian real relative to the U.S. dollar.
Previous wording
Included in Financial Services, Other assets on the Company’s Consolidated Balance Sheets are used trucks held for sale, net of impairments, of $396.5 million at December 31, 2024 and $309.8 million at December 31, 2023. These trucks are primarily units returned from matured operating leases in the ordinary course of business, and also include trucks acquired from repossessions, through acquisitions of used trucks in trades related to new truck sales and trucks returned from residual value guarantees (RVGs).
Current wording
Included in Financial Services, Other assets on the Company’s Consolidated Balance Sheets are used trucks held for sale, net of impairments, of $389.4 million at December 31, 2025 and $396.5 million at December 31, 2024. These trucks are primarily units returned from matured operating leases in the ordinary course of business, and also include trucks acquired from repossessions, through acquisitions of used trucks in trades related to new truck sales and trucks returned from residual value guarantees (RVGs).
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