Navistar reorganizes truck business

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To propel momentum of its business strategy around customers, products and growth opportunities, Navistar International Corp. has announced that it will organize its truck segment into four business units: North American Truck Operations, Global Truck Operations, Global Bus Operations and Navistar Defense.

The reorganization enhances the company’s competitiveness around the world and strengthens its core businesses in North America, says Dan Ustian, chairman, president and chief executive officer of Warrenville, Ill.-based Navistar.

“We are organizing our truck segment to better capitalize on the momentum and opportunities ahead for Navistar in our core markets and around the world,” Ustian says. “Just a few years ago, we set the goal to double our revenue to become a $15 billion company by 2009, and we are on the brink of achieving that mark despite one of the worst North American truck markets in recent history and the overall hardship of the U.S. economy. We must look at ways to continue our forward momentum around customers, new products and growth opportunities.”

The changes will involve some targeted job reductions as functions are consolidated and streamlined to align with market conditions, but the company says numbers have not been determined:

North American Truck Operations – Customers in Navistar’s core markets in North America will be served by a team with a singular focus on products, operations and sales for the United States, Canada and Mexico;

Global Truck Operations – Customers in markets outside of North America will see products developed specifically for their unique needs by a team focused on global product development, sales and operations. These efforts will include expanding Navistar’s export operations and further development and implementation of Navistar’s joint venture with Mahindra, as well as a proposed joint venture with Caterpillar;

Global Bus Operations – Will lead all commercial and school bus product development, operations and sales throughout the world. For instance, a subsidiary of Navistar based in Mexico and a Brazilian bus body builder are exploring a joint venture to manufacture commercial bus bodies to be distributed as commercial integrated buses through the IC Bus Dealer channel beginning in 2009. In addition, the Bus team is delivering school buses to First Student as part of an agreement valued at up to $1.2 billion for CE Series school buses through 2010, with an option to provide additional buses through 2012; and

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Navistar Defense – As a sustainable $2 billion annual business, Navistar Defense will continue converting commercial truck platforms, engines and components into specialized vehicles for the U.S. military and allied countries. Navistar’s place in the defense sector is highlighted by its MaxxPro Mine Resistant Ambush Protected (MRAP) vehicle and Medium Tactical Vehicles (MTV) built off the International WorkStar truck platform.

Further definition of the new organization structure and appointment of executives will take place over the next two months, according to the company.