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Navistar International (NYSE: NAVI) | Company Profile, History, Competitors

 

Navistar International (NYSE: NAVI) manufacturers and sells commercial trucks in North America. It was founded in 1902 and headquartered in Lisle, IL.

Navistar produces medium and heavy duty trucks for regional, long haul, fire & rescue and other uses. They are also one of the three main OEM school bus producers in North America.

Navistar runs its business under a razor/razor blade model. Navistar sells its trucks at competitive prices and makes profits by supplying parts when they are brought in for repairs. Navistar also has a captive financing arm where it provides financing for vehicle purchases.

Business Overview

Navistar has four main business segments:
  • Trucks (60% of Revenues): Navistar focuses on the production of Class 4-8 trucks, buses and military vehicles. They have a very strong presence in medium-duty space and as well as school buses.
  • Parts (30% of Revenues): Navistar has nine parts distribution centers in North America and participates in the aftermarket parts business. Navistar has the largest dealership network in North America with over 1,000 dealer points in United States, Canada, Brazil and Mexico.
  • Global Operations (5% of Revenues): Navistar's international business which includes its diesel engine manufacturing in South America.
  • Financial Services (5% of Revenues): Navistar provides retail, wholesale and leas financing for trucks and parts. 

Volkswagen

In September 2016, Volkswagen invested $256mm for 16.6% of Navistar equity. Navistar will be able to license blueprints for its powertrains from Volkswagen. This will help Navistar reduce product development costs. Volkswagen will receive licensing fees on its technology.

Management

Troy A. Clarke (CEO): Troy Clarke serves as CEO since 2013. Prior, he served in various roles at Navistar, including COO, President of Truck & Engine Operations, President of Asia-Pacific operations. He also served in roles at General Motors, including VP of Manufacturing & Labor, VP of Asia-Pacific and President of Mexico Operations.

William V. McMenamin (CFO): William McMenamin serves as CFO since 2015. Prior, he was President of Trucks & Parts and CFO of Navistar Financial.

Financials

 $ USD in millions    2013    2014 2015 2016 2017
 Revenues $10,775 $10,806 $10,140 $8,111 $8,570 
 Gross Profit $1,014 $1,272  $1,470  $1,299  $1,533 
 Operating Profit  ($729)($263) $168  $213  $388 
 Net Income ($898)($619)($184)($97) $30 
 EPS ($11.17) ($7.60) ($2.25) ($1.19) $0.32