In a earnings call for the Penske Automotive Group at the end of the first quarter, the management group of the multinational automotive company took questions from analysts on the results so far and plans for the future.
In response to a question from Brian Sponheimer from G.Research, Chairman, CEO and Chairman of the Executive Committee of the Group, Roger Penske made mention of the business’ intentions here in Australia with Penske Commercial Vehicles. Six months ago the Penske organisation took over the distribution business in Australia for Western Star, MAN and Dennis Eagle.
The early signs indicate a rapid expansion of services from the group here with PCV invigorated by new initiatives and the increased attention from top management in the US, who have visited Australia regularly over the last few months. Penske suggests the company’s experience with Freightliner in the US will give them a head start in developing the PCV business and expanding its reach in the truck market.
“Our Commercial Vehicle platform, which we’ve started in Australia has really opened up an opportunity for us to grow in those markets and our investment we have in a Freightliner dealership here in the U.S. is giving us some good ideas from a standpoint of growth,” said Penske.
Questioned further about the organisation’s capacity to expand without having to stray into high leverage territory was answered by Penske. It also suggests the truck distribution business is not Penske’s only target here.
“Obviously, we want to watch interest rates from the standpoint as we fund some of these acquisitions” said Penske. “But the cash flow has been strong and I think what we want to do is have a balanced balance sheet from a standpoint of automotive, trucks, retail and leasing and I think the distribution business will add another value to us in Australia.”