CNH Industrial plans Iveco spinoff

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  • Plant & Equipment

Five year plan to see commercial vehicles and powertrain listed

CNH-Iveco
Hubertus Mühlhäuser

CNH Industrial’s new Transform 2 Win five-year plan will see Iveco become the major part of a separately listed entity.

The industrial conglomerate plans to split its ‘On-Highway’ and ‘Off-Highway’ assets by early 2021 on shareholder agreement.

The move follows "a deep portfolio review process, taking into account, among other things, strategic, investor, and synergy considerations".

"The bold plan will lead to the creation of two new global leaders in their respective fields," CNH Industrial chair Suzanne Heywood says.

"The board of directors strongly supports this ambitious strategy and its confidence is underpinned by the rigorous work undertaken to formulate it."

On-Highway will comprise the Iveco, Iveco Bus and Heuliez Bus commercial vehicle brands, making up 69 per cent of revenue, together with the FPT Industrial powertrain business at 31 per cent of revenue.

Iveco brands’ market position and product line-up will gain investments in product and technology upgrades.

FPT Industrial will continue to produce powertrain solutions and accelerate the development of alternative propulsion solutions.

It will remain a key supplier to Off-Highway through a long-term supply agreement.

Off-Highway will have 75 per cent of revenues from agriculture, through Case IH, New Holland Agriculture and Steyr, backed by 19 per cent from construction, CASE Construction Equipment, New Holland Construction and Iveco Astra heavy duty quarry trucks.

Specialty vehicles, at 6 per cent, will remain within the Off-Highway.

will build on their market positions, further strengthened product line-ups and improved distribution, and accelerated investment in automation and digitalisation activities, will focus on improving profitability, product range simplification and growing share in application specific segments.

Military vehicles and Magirus firefighting will further develop their industry leading offerings for their specialized customer base.

"With our Transform 2 Win strategy we are setting an exciting new direction for our company," CEO Hubertus Mühlhäuser says.

"By developing ambitious yet achievable targets for each segment and reorganizing our structure to create two global leaders, all of our great businesses will be better able to realise their full potential in terms of financial performance, shareholder and broader stakeholder value generation and sustainability commitments.

"Our clear assessment of the key megatrends, that are rapidly changing the business landscape, has led us to embrace this challenge and transform the company.

"Benefiting from greater management focus, the two companies will accelerate their innovation, be nimbler in their strategic thinking and actively participate in industry consolidation.

"This is all thoroughly consistent with our strategic purpose of ‘powering sustainable transformation’."

 "This is all thoroughly consistent with our strategic purpose of ‘powering sustainable transformation’."

Comment from Iveco Australia has been sought.

 

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