“Before addressing our second quarter results, I would like to comment on the two major developments that were announced today. Firstly, Tata Motors has made an offer to acquire Iveco Group, excluding Defence, and together creating a global player in commercial vehicles; secondly, we have reached an agreement with Leonardo for the sale of our Defence Business. The combined operations of Tata Motors and Iveco Group, excluding defence, will create a commercial vehicles group with the reach, product portfolio and industrial capability to be a global champion in this dynamic sector. Simultaneously, IDV and ASTRA will become an integral part of a significantly larger business, that will be better able to invest and compete in a segment whose strategic importance is paramount.

These developments come after a second quarter of the year that unfolded broadly in line with our expectations, shaped by reduced industry demand across the European Truck and Powertrain segments. Market softness was most notable in light commercial vehicles, where the year-over-year comparison was negatively impacted by last year’s pre-buy effect. In response to these challenging market dynamics, we remained agile, aligning our production levels accordingly, while maintaining disciplined execution and consistent focus on our long-term strategic vision.

Looking across our business units, Truck order intake gained momentum, confirming the competitiveness of our Model Year 2024 product line up, especially the heavy vehicles. Diligent pricing discipline helped secure flat sequential pricing performance in light-duty, and slightly higher performance in heavy-duty.

Powertrain continued to navigate tough market conditions, in both on- and-off-road applications. Through strict cost control and the accelerated implementation of the Group’s Efficiency Programme, we mitigated the impact of reduced volumes. We also absorbed higher quality costs, investments that will elevate product standards and drive increased long-term customer satisfaction. We expect deliveries to third-party customers to progressively recover in the second half of the year.

In both Bus and Defence we delivered strong results, with continued margin improvement year-over-year, backed by solid order books and favourable industry momentum.

Our free cash flow performance was positive for the quarter. We also registered a positive year-over-year swing in working capital and 145 million euros in cash generation – partly due to the acceleration of our Efficiency Programme. We are continuing to expedite this programme and reprioritising certain investments, and we confirm the forecasted savings of 150 million euros in CapEx plus OpEx for the current year. Additionally, we have identified other areas of improvement that may stimulate further full year savings.

Given the persistent macroeconomic uncertainties and the delay in the recovery in the light-duty segment – particularly in chassis cab and rental fleets – we have revised our full year guidance. A counterpoint to this is, however, that customer fleets are ageing and we expect a progressive recovery.

In the meantime, we continue to manage costs and production capacities cautiously, especially in the European light-duty segment, where we are adjusting production levels to match expected retail demand for the remainder of the year.

This year is important for us as it marks IVECO’s 50^th anniversary, and I am proud to say that at 50, IVECO is full of vitality and getting stronger every quarter.

Alongside the Tata Motors and Leonardo transactions, our strategy will unlock significant potential to scale our industrial capabilities, accelerate innovation in zeroemission transport and expand our reach in key global markets. I believe that this approach will allow us to deliver increased long-term value to all stakeholders and be the launchpad to an exciting future."

Olof Persson, Chief Executive Officer

Notes:

⁽¹⁾ Non-EU-IFRS financial measures: refer to the “Non-EU-IFRS Financial Information” section of this press release for information regarding non-EU-IFRS financial measures. Refer to the specific table in the “Other Supplemental Financial Information” section of this press release for the reconciliation between the non-EU-IFRS financial measure and the most comparable EU-IFRS financial measure.

⁽²⁾ Comparison vs 31^st March 2025.