Iveco bets on partnerships as it guides for 20% revenue growth to 2028
Reuters
Published Mar 14, 2024 08:48AM ET
Updated Mar 14, 2024 11:16AM ET
TURIN, Italy (Reuters) -Italy's Iveco Group plans to focus on new and deeper partnerships for future growth, the bus and truck maker said on Thursday, as it unveiled a new five-year business plan targeting a 20% bump in revenue by 2028.
The group, controlled by Exor (AS:EXOR), the investing company of the Agnelli family, will invest 5.5 billion euros ($6 billion) between this year and 2028, it said, with a focus on energy transition, artificial intelligence & software defined vehicles, and autonomous driving.
It announced on Thursday a preliminary deal with Ford (NYSE:F) Trucks, the heavy commercial brand of Ford Otosan, for potential cooperation in developing heavy-duty truck cabins.
It said it would also extend its existing partnership with South Korea's Hyundai Motor (OTC:HYMTF) in battery-electric and hydrogen fuel-cell electric (FCEV) vans and FCEV city buses to electric heavy-duty trucks for the European market.
Iveco has lagged competitors in the heavy-duty truck segment in recent years.
"Today we commit ourselves to a new plan, an acceleration of our product portfolio, stronger and more diverse partnerships, and a dialling up of our sustainability journey," CEO Gerrit Marx said.
Milan-listed shares in the company extended gains after the five-year plan was published, and were up 11.8% by 1500 GMT.
The group - the smallest among Europe's truck-making heavyweights such as Daimler (OTC:MBGAF) Truck, Volvo (OTC:VLVLY) and Traton - has been a stand-alone company since the beginning of 2022, when it was spun off from CNH.
Analysts have often seen Iveco as a potential target in industry consolidation, but Marx has presided over a partnership-based strategy to support its access to new technologies, including clean-mobility ones, and new market segments.
Iveco said its net revenues from industrial activities would rise to around 19 billion euros in 2028 from 15.9 billion euros last year. Margin on adjusted operating profit (EBIT) from industrial activities is seen between 7% and 8% in 2028, from 5.2% in 2023.
($1 = 0.9164 euros)
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Written By: Reuters
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