Dow Jones Newswires | Navistar International Corp. said Tuesday it received an order from
trucking company J.B. Hunt Transportation Services Inc. to supply more
than 5,000 heavy-duty commercial trucks through 2014.
The contract is the first time the Arkansas-based trucking company has
bought International brand trucks since 1997. Most of the trucks also
will be powered with Navistar’s new 13-liter engines, which the company
has been promoting as an alternative to the 15-liter engines from
Cummins Inc. Navistar’s MaxxForce engines for J.B. Hunt also will
feature the company’s controversial pollution-reduction system that has
been widely panned by Navistar competitors.
“It’s an affirmation that customers are willing to forego the 15-liter engine and buy the 13 liter and that their 1/8 emissions system 3/8 is commercially viable,” said Walt Liptak, an analyst for Barrington Research.
Liptak estimates that the order will add about 5 cents a year to Navistar’s earnings for the next five years. Analysts expect Navistar to earn $2.87 a share this year on sales on $12.2 billion, according to Thomson Reuters.
Illinois-based Navistar also acknowledged that it’s working on the final details of a contract to supply at least 600 heavy-duty trucks to another major trucking company.
Navistar’s stock was recently trading up 6.1 percent at $53.60.
The J.B. Hunt order is the latest sign that the long-suffering commercial truck market is rebounding as trucking companies replace their aging truck fleets. The commercial truck sales have been mired in a slump since 2007, as volume in 2009 fell to the lowest levels seen in decades.
“Through this supplier agreement with Navistar, we will be adding some of the most fuel-efficient and driver friendly tractors in the industry to our fleet,” J.B. Hunt Chief Executive Kirk Thompson said in a written statement.
New federal standards for reducing nitrogen oxide in diesel engine exhaust forced engine manufacturers to install elaborate treatment systems starting this year. Most manufacturers are deploying a system used widely in Europe that douses diesel exhaust with a urea solution drawn from a reservoir on new trucks.
Navistar is the only truck manufacturer in North America that opted for a system that recirculates exhaust through its engines. The system does not require urea fluid, reducing truck operators’ expenses. But Navistar’s so-called Exhaust Gas Recirculation system, or EGR, has been ridiculed by competitors claiming that MaxxForce engines provide lower fuel economy than engines with the more popular Selective Catalytic Reduction system, or SCR.
The fight between Navistar and the rest of the North American truck industry spilled over to the U.S. Environmental Protection Agency. Navistar sued the EPA last year, accusing the agency of allowing truck manufacturers using SCR to dictate the EPA’s usage guidelines for SCR.
Last week, Navistar and EPA agreed to an out-of-court settlement that requires the EPA to review its policies and conduct hearings on SCR.
Does anyone know the real reason J.B. Hunt is going to Navistar International Corp? Because Freightliner’s are about all built in Mexico now THANKS TO NAFTA and dont be hatin on the current President, not for that anyways cause who do you think picked Jimmy Carters peanuts hahahaha my job with freightliner went to mexico but you cant blame them for getting 8 lil mexicans for what they was paying me :p
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