Navistar to redesign trucks, begin UAW talks in Springfield in 2018

Jan 30, 2018

Navistar has several big ticket items planned in 2018, including a redesign of all of its truck, a new labor contract in Springfield and production starting here on a new GM truck.

Annual reports and documents filed recently by Navistar show the truckmaker gained market share last year and company leaders are optimistic for a strong 2018, although the Illinois-based company faces challenges that include a competitive U.S truck market and other risks.

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Navistar is a major employer in Clark County, with more than 1,800 workers at its Springfield manufacturing plant and thousands of retirees living in the area. The manufacturer reported a $30 million profit in 2017 — its first annual profit in six years — after weathering turmoil that included top management changes, legal struggles, a recession and a failed engine technology.

The company’s latest annual report says Navistar gained market share in a competitive truck market last year, and is poised for a strong year as demand picks up in the heavy and medium-duty truck markets. Troy Clarke, Navistar’s CEO, cited 2017 as a breakthrough year for the company, which he said achieved its largest single-year market share gain in the last eight years.

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Navistar saw growth in every truck segment last year, Clarke said in the company’s annual report, and added new vehicles, like an electric school bus that will go on sale in 2019.

“We expanded our success with large fleets, more than doubling the number of customers placing orders of more than 500 vehicles,” he said.

In it annual report, Navistar also reported several risk factors that could affect it in 2018, including a highly competitive truck market worldwide and debt.

“Many of our competitors have greater financial resources, which may place us at a competitive disadvantage in responding to substantial industry changes, such as changes in governmental regulations that require major additional capital expenditures,” Navistar’s annual report says. “In addition, certain of our competitors may have a lower overall cost structure.”

The annual report also highlighted other accomplishments last year, including finalizing a strategic alliance with Volkswagen Truck and Bus. 

It also refreshed its vehicle lineup and will continue to announce a new or redesigned product every four to six months through the end of this year, the report says. By the end of 2018, Navistar’s entire portfolio will consist of newly designed trucks.

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In Springfield, officials from the UAW Local 402, which represents the majority of workers here, said Navistar’s contract with the UAW, reached in 2015, is set to expire in early October. That means negotiations will ramp up later this year.

Local leaders have described the latest contract as a sign of an improving relationship between Navistar and the UAW.

Investments at Navistar since the last contract have led to a boost in hiring and other improvements in the Springfield economy, said Michael McDorman, president and CEO of the Chamber of Greater Springfield.

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“The company is in a much better position today than they were four years ago,” McDorman said.

Workers in Springfield will also begin building a new medium-duty truck later this year as part of a joint agreement with GM. The all-new Silverado Class 4 and 5 chassis cab trucks will be unveiled at the Work Truck Show, which is scheduled for March 6 to 9. The truck is expected to go into production in Springfield in late 2018, according to information from GM.

“Heavy truck orders continue to increase and the new GM product will launch this year,” said Jason Barlow, president of the UAW Local 402 in Springfield.