Scania has recorded a strong result for the full year 2021 despite myriad supply issues that have so badly affected every industry across the globe.
The company has reported some positive numbers although these are tempered by the lack of supply and a large provision for a court judgement relating to a European Commission competition investigation that amounts to close to $ AUD850 million (SEK5229)
Overall Scania’s net sales were up 17 per cent to $AUD 21.119 billion (SEK146.15 billion) while its operating profit was up a staggering 86 per cent to $AUD 2.38billion (SEK16.52 billion) , however this was dragged down to $AUD1.62 billion (SEK 11.29billion) by the provision for the European court ruling.
Overall the result for the Swedish company was strong and underlined its role as the star of the VW controlled Traton Group.
Scania CEO Christian Levin was upbeat despite the headwinds generated by the supply chain shortages.
“The year 2021 for Scania has been characterised by record strong demand for trucks while we faced an extreme challenge in meeting this demand due to a shortage of components in the supply chain,” Levin said.
“Together with our suppliers, the organisation has made an extraordinarily strong effort to get so many trucks out to our customers in such a difficult situation. The shortage of components, in particular of semiconductors, meant that we were forced to reduce our production volume during the third and fourth quarters of 2021,” said the Scania CEO.
He explained that the production disruptions led to a loss of volume of trucks and increased costs and meant the company faced increased costs for materials and freight in its supply and delivery flows.
Despite this Levin said the company continued to perform and both sales and earnings increased in 2021 compared to 2020.
“During the turbulent year of 2021, we remained focused on Scania’s decarbonisation commitment and we took several important steps towards sustainable transport. In the fourth quarter, we introduced Scania Super with a powertrain based on our new engine platform which provides fuel savings of at least 8 per cent. Just like all our vehicles, it is prepared for operation on renewable fuels,” said Levin.
“We also launched our second generation of hybrids and plug-in-hybrids during the fourth quarter. In innovative partnerships with customers, we have also developed fully electric trucks for the heaviest applications, demonstrating that all applications are possible to electrify,” he added.
“Serial production of our e-offering; hybrids, plug-in-hybrids and fully electric trucks is now underway side by side with combustion engine vehicles on the production lines.”
“We are continuing to invest in electrification in order to drive this shift. In 2021, we increased our R&D investments and we are now investing more in technology linked to electrification than in traditional combustion engine technology. We have pledged to bring our customers at least one new electric product application in the bus and truck segment every year,” the Scania CEO said.
He went on to say that the strong demand for trucks is not fully reflected in the order intake which was restricted because by its already large order books and the production start of Scania’s new powertrain program.
Despite that Scania’s vehicle deliveries decreased in the fourth quarter while its service business remained strong with a 16 per cent increase in revenue.
Scania’s sales and earnings from both its vehicle and service activity increased in the fourth quarter compared to the same period in 2020 and it reported a growing portfolio and low credit losses in its Financial Services operations as a result of what it cited as high activity levels across its customer base.