Strategy
TRATON Way Forward
Ongoing climate change, the growing importance of sustainability, decarbonization, and digital transformation pose complex challenges for TRATON, yet also present a large number of opportunities. The TRATON GROUP’s strategy, the TRATON Way Forward, is based on a long-term vision that describes how TRATON will manage this environment and hence the resulting changes expected in the transportation and logistics industry. As part of this strategy, TRATON has set itself the overarching goal of acting sustainably and responsibly at all times.
The TRATON Way Forward consists of three pillars, together with an additional focus on the systematic implementation and execution of the strategy. The elements are: (1) Responsible Company; (2) Value Creation; (3) TRATON Accelerated!; and (4) Strategy Execution.
Responsible Company
The TRATON GROUP intends to become even more responsible as a company in every respect. Decarbonization, circularity, and human rights play a key role in this endeavor and are a top priority for us. Together with our brands, we are working hard on our purpose of continuing to transform transportation in a sustainable way. Our objective is to generate the greatest possible benefit for our customers and society as a whole across the entire life cycle of our products. The TRATON GROUP has a strong focus on achieving its environmental objectives and strengthening sustainable conduct toward people: employees, customers, suppliers, and strategic partners. Being responsible has the highest priority and influences everything we do.
As part of our strategy, we have set ourselves the target of around half of our annual new vehicle sales in the relevant regions (EU27+3 region, USA, and Canada) to be zero-emission vehicles by 2030. This target is subject to the conditions needed to achieve it, such as the expansion of the corresponding charging infrastructure and the various grid connections, as well as a supportive regulatory environment, being in place. It will also allow us to make a significant contribution to the decarbonization of the global transportation sector. One example of our stronger sense of responsibility is the establishment of the Milence charging joint venture together with Daimler Truck and the Volvo Group. The joint investment of €500 million to build at least 1,700 public charging points for heavy-duty trucks and coaches by 2027 is a key factor for the expansion of electric mobility. The first site started operating in Venlo on December 7, 2023. Additional sites in Belgium, Germany, France, and Sweden followed in 2024. Milence plans to have over 70 sites operating by the end of 2025.
Responsible Company also includes a corporate culture that focuses on people and diversity. Our understanding of the term goes beyond the popular notion of diversity. The TRATON GROUP will strengthen its actions to consciously bring together and secure the inclusion of people with different experiences, educational backgrounds, and personalities. To be able to act responsibly, the Company also continues to focus increasingly on ethical principles in corporate governance.
Value Creation
For TRATON, customers are the focus of value creation, which is why it is the second pillar of TRATON’s strategy. TRATON can only be successful as a company and build a foundation for creating value for all TRATON GROUP stakeholders in the long term if it can sustainably create value for its customers and enhance their business success. Unlocking additional revenue streams and developing important markets are key elements of this strategy. The TRATON GROUP has defined ambitious medium-term business performance targets and communicated them at its 2024 Capital Markets Day in Munich. Adjusted operating return on sales is expected to be between 9 and 11% in 2029. Over the period from 2024 to 2029, the TRATON GROUP’s sales revenue is projected to grow between 20 and 40%. During this period, TRATON also aims to completely eliminate net debt in the TRATON Operations business area, including Corporate Items. Making all TRATON brands even stronger is another objective. Each brand has a clearly defined, brand-specific strategic target return and works to deliver on it.
TRATON’s entry into the North American market in 2021 strengthened its global footprint by giving it access to the world’s largest profit pool in the commercial vehicle industry. International (formerly: Navistar) plays a key role in this regard and will be led to new strengths as part of our strategy. The measures for doing this range from using the powerful component and technology setup within the TRATON GROUP and expanding the financial services business, all the way to even more effectively leveraging International’s dealer and service network, which is one of the largest independent networks in the North American market. The development and launch of the new International S13 Powertrain on the basis of the Group-wide 13-liter Common Base Engine (CBE) diesel engine is a key milestone. In 2024, a large number of customers took delivery of their vehicles with the new energy-efficient powertrain.
As part of our global expansion, we will additionally strengthen our footprint in Asia by also establishing an industrial presence in China. China is the world’s largest commercial vehicle market. Chinese fleet customers are increasingly looking to higher-end vehicles, expecting more and more in terms of efficiency and safety. TRATON meets this demand by making appropriate investments in this region. In addition to providing additional production capacity in Asia, the presence in China also allows TRATON to capitalize on technological innovations in the Chinese market.
TRATON Accelerated!
The third element of the TRATON strategy is particularly forward-looking. In a world shaped by electrification, autonomous driving, and connectivity, TRATON will create more added value for customers in the future through new business models, solutions, and partnerships. To do this, the Company intends to create new business models and partnerships. The TRATON GROUP is accordingly expanding its perspective on business potential beyond pure transportation. What matters here is developing the right capabilities and partnerships in order to be able to help shape the transformation of the industry. For example, Scania launched the first series production solution for autonomous driving in confined areas in 2024. Mining company REGROUP ordered eleven Scania vehicles that will start operating in an Australian mine at the end of 2025. Another example is the establishment of Scania’s Erinion subsidiary, which will plan, implement, and, if the customer wishes, operate brand-neutral depot charging solutions for customers.
Strategy Execution
The fourth element is focused on executing the strategy. TRATON has set out the strategic framework for the coming years with the TRATON Way Forward. The task now is to implement this strategy systematically. One example is to concentrate development capabilities and hence strengthen the overall competitiveness by developing a TRATON Modular System and through closer organizational integration. We laid the cornerstone by establishing new Group functions (Group Industrial Functions) for research & development and by coordinating purchasing, production, and logistics across the whole Group.
All four elements of the TRATON Way Forward are interconnected. Together, they form the strategy that makes it possible for the TRATON GROUP to create an even more responsible company, add value, and pave the way toward a sustainable future.