According to Reuters,
Navistar International Corporation
) will be incurring a charge of $40 million to $60 million in the
fourth quarter of 2012 associated with its headcount reduction
program. Earlier this month, the company offered an opportunity to
most of the U.S. based non-represented salaried employees to apply
for the voluntary separation program. The company also planned to
undertake involuntary reduction of workforce in a bid to achieve
FORD MOTOR CO (F): Free Stock Analysis Report
NAVISTAR INTL (NAV): Free Stock Analysis Report
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Separately, Navistar Financial Corporation (NFC), the subsidiary of
the company's Financial Services segment, has announced the renewal
and increase of its largest dealer inventory funding facility to
$750 million. This will provide greater flexibility in funding
The $750 million facility will be funded by the three major
relationship banks of NFC. In addition, the deal will support the
company's long-term strategy to support the dealer network and
improve the sale of Navistar products. In the second quarter of
2012, the company's inventories increased 14% to $1.95 billion from
$1.71 billion in the corresponding quarter last year.
Warrenville, Illinois-based Navistar manufactures and sells
commercial trucks, mid-range diesel engines, buses, military
vehicles and chassis for motor homes and step-vans. It also
provides service parts for various trucks and trailers. The
company's U.S. controlled domestic competitors include
Ford Motor Co.
Currently, Navistar retains a Zacks #5 Rank, which translates into
a short-term (1 to 3 months) Strong Sell rating. The company faces
difficulty in obtaining U.S. regulatory approval for the new
generation of its diesel engine. We have a long-term (more than 6
months) Underperform recommendation on the stock.