PACCAR Inc.

Good morning and welcome to PACCAR's first quarter 2025 earnings conference call. All lines will be in listen-only mode until the question and answer session. Today's call is being recorded and if anyone has an objection, you should disconnect at this time. I'll now like to introduce Mr. Ken Hastings, PACCAR's Director of Investor Relations. Mr. Hastings, please go ahead.

Good morning. We would like to welcome those listening by phone and those on the webcast. My name is Ken Hastings, PACR's Director of Investor Relations. And joining me this morning are Preston Fite, Chief Executive Officer, Harry Skippers, President and Chief Financial Officer, Kevin Behney, Executive Vice President, and Bryce Popovsky, Vice President and Controller. As with prior conference calls, we ask that any members of the media on the line participate in a listen-only mode. Certain information presented today will be forward-looking and involve risks and uncertainties that may affect expected results. For additional information, please see our SEC filings at the investor relations page of paccar.com. I would now like to introduce Preston Fite.

Thanks, Ken. Good morning, everyone. First, I'd like to congratulate Harry Skippers on his upcoming retirement after a wonderful 39-year career at PACCAR. We'll all miss him. And we wish him all the best on the next chapter in his life. Congratulations to Kevin Bainey, our Executive Vice President, who's been responsible for Dov Trucks and will now become responsible for PACCAR Financial Services. Kevin will also work with Ken on investor relations. And congratulations to Bryce, who has been promoted to PACCAR Senior Vice President and CFO, reporting directly to me. I'd like to thank Packard's outstanding employees who did an excellent job providing our customers with the highest quality trucks and transportation solutions in the industry. Packard achieved good revenues and net income in the first quarter, including record revenues at Packard Parts, good performance by the truck divisions, and strong financial services results. Packard achieved revenues of $7.4 billion and adjusted net income of $770 million. Packard Parts achieved record quarterly revenues of $1.7 billion and quarterly pre-tax income of $427 million. We're pleased with the continued growth at Packard Parts after a record-setting 2024. Packard Financial had a very good quarter, achieving pre-tax income of $121 million, which is 6% higher than the $114 million in the first quarter of last year. We estimate this year's US and Canadian Class 8 market to be in a range of 235,000 to 265,000 trucks. The North American truck market is being affected by uncertain economic conditions and the overall impact of new tariffs. In Europe, DOF's premium aerodynamic trucks provide customers with the latest technology and the best operating efficiency. We project the 2025 European above 16 ton market to be in a range of 270 to 300,000 trucks. This year's South American above 16 ton truck market, where DOF trucks are highly desired by our customers, is expected to be in a range of 100 to 110,000 vehicles. PACCAR delivered 40,100 trucks during the first quarter and anticipates delivering 37 to 39,000 trucks in the second quarter. PACCAR's truck Parts and other gross margins were 14.8% in the first quarter, as economic uncertainties and tariffs began affecting input costs and truck pricing. With a full quarter of current tariff-related impacts, we anticipate second quarter margins could be in a range of 13 to 14%. Margins could improve considerably depending on how the announced truck tariff policy investigation progresses. In the second half of the year, we anticipate increased customer demand as policy and emissions regulations become more stable. PACCAR's industry-leading trucks, expanding parts business, best-in-class financial services, and advanced technology strategy position the company well for an excellent future. Harry Skippers will now provide an update on PACCAR parts, PACCAR financial services, and other business highlights. Harry, over to you one last time.