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Investig.com -- Volkswagen’s truck subsidiary Traton SE (ETR:8TRA) cut its full-year outlook on Thursday, warning of increased global uncertainty, particularly in the U.S., where trade tensions and hesitant buyer sentiment are weighing on demand.
Shares in Traton plunged nearly 9% in Frankfurt trading following the results.
The company now expects unit sales and revenue to decline by as much as 10%, a sharp revision from its previous forecast of between a 5% drop and 5% growth. It also lowered its adjusted operating margin target to 6%–7%, down from 7.5%–8.5%.
According to Jefferies analysts, the guidance range implies an EBIT of €2.6-3.3 billion, with the midpoint of €2.9 billion. That’s lower than the consensus estimate of $3.2 billion, the firm noted.
"Focus will be on the change to ’25 guide with Group EBIT -20% at the midpoint," analyst Michael Aspinall said. "The change to guidance is larger than expected given the primary market weakness is the U.S. and with International just 10% of EBIT in ’25."
The guidance cut comes despite an 11% increase in first-half orders, supported by replacement demand in Europe. However, Traton noted the broader economic picture remains fragile, with continued weakness in Europe, subdued conditions in Brazil, and persistent caution from North American truck buyers.
"Although we are currently operating in a difficult and uncertain market environment, we are proactively addressing these challenges with cost consciousness, production flexibility, and focus on services," CEO Christian Levin said.
Traton, which owns brands including Scania, MAN, and Navistar (NYSE:NAV), reported a 33% drop in adjusted operating profit to €1.4 billion for the first half, while revenue declined 6% to €21.9 billion.