Truck maker Scania Q3 sales miss forecast, shares fall

Truck maker Scania missed expectations for third-quarter sales growth and warned that bottlenecks could emerge among suppliers as production rates rose.

Scania shares fell 5.8 per cent to 143.4 crowns by 0733 GMT, underperforming a 0.3 per cent gain in the Stockholm bourse's all share index.

Sales at the vehicles group, majority-owned by Germany's Volkswagen, rose to 18.6 billion Swedish crowns ($2.8 billion) from 13.4bn a year ago due to firming demand in its main markets, but came in shy of the 20.0bn seen in a Reuters poll of analysts.

Heavy-duty truck makers have emerged from the steepest downturn in decades in the wake of the global financial crisis, led by booming growth in emerging markets and a gradual upturn in Europe and North America.

A wave of cost-cutting undertaken by commercial vehicle makers such as Scania and domestic rival Volvo during the crisis is now boosting profitibility across the industry as previously idle plants are shifted into higher gear.

Scania's third-quarter pretax profit bore evidence of the strong earnings momentum, rising to 3.4bn crowns ($509.9 million) versus 383 million a year ago to come in above the 2.9bn seen by analysts.

Last week, Volvo rolled out stronger-than-expected earnings and forecast continued double-digit market growth on both sides of the Atlantic next year, though it cautioned massive public spending cuts in parts of Europe could weigh.

Scania however, was tight-lipped about market prospects.

"The daily production rate has increased continuously during the period and Scania has focused on maintaining short delivery times," the company said in a statement.

"The increase in the production rate has meant that the risk of bottlenecks has increased among both sub-contractors and bodybuilding companies."