Volkswagen truck arm forecast: Traton, the trucks arm of Volkswagen, anticipates maintaining a stable return on sales in 2024, following a major increase in core earnings driven by heightened demand for commercial vehicles post-pandemic. 

The company, known for its MAN and Scania trucks, predicts an adjusted operating return on sales of 8-9 per cent for 2024, aligning with the 8.6 per cent achieved last year.

In 2023, Traton saw a 95 per cent surge in adjusted operating profit to 4 billion euros ($4.34 billion), surpassing the consensus estimate.

However, the company noted a 20 per cent decline in its order backlog for the year, signalling challenges ahead.

CEO Christian Levin stressed the need for continued focus in 2024 amidst a softening market environment for trucks in certain regions. 

Traton aims to capitalise on its strengths despite analysts' predictions of a tougher year ahead, particularly in Europe and North America, following record demand levels in 2023 post-COVID-19.

Traton provided a wide-ranging outlook for 2024 unit sales, forecasting a range of -5 per cent to +10 per cent, reflecting the sector's uncertainty. Similarly, other European truck manufacturers like Daimler Truck and AB Volvo have adopted a cautious stance for 2024 after experiencing increased sales last year.

Traton's executive board intends to propose a dividend of 1.5 euros per share, more than doubling last year's payout of 0.7 euros. 

Despite initial fluctuations in share value, Traton's stock stabilised to trade nearly flat by 08:05 GMT after a 2 per cent decline at the opening in Frankfurt.

(With Reuters Inputs)