European Truck Stocks Fall After EPA Sets Rollback of Emissions Standards
The regulation was expected to drive demand for compliant trucks
Shares in European truck makers fell, with Daimler Truck Holding DTG -5.13%decrease; red down pointing triangle hit the hardest, after the U.S. Environmental Protection Agency said it would reconsider truck-emissions regulations that analysts saw as a source of demand for the industry.
Daimler Truck’s shares were down 7.2% in European midday trading Thursday, having dropped as much as 15% earlier. German peer Traton was down 3.2%, with Sweden’s Volvo down 2.8% and Italy’s Iveco Group IVG -0.33%decrease; red down pointing triangle down 1.3%.
The EPA said Wednesday that it would reconsider Biden-era light-duty and medium-duty regulations and greenhouse gas emissions standards for heavy-duty vehicles. The move was part of an overhaul of U.S. environmental policies, with EPA head Lee Zeldin saying 31 actions had been initiated and were under way.
The potential rollback in 2027 truck emissions regulations means deregulation headwinds begin for the industry, given that this was expected to drive demand for trucks compliant with the regulations, analysts at Jefferies said in a research note.
“If 2027 regulations are rescinded, the prebuy will not happen, in our view, leaving the industry to revert to underlying transport economics,” the analysts said.