The Turin-based Iveco Group on Thursday said proposed acquisition of the company is expected to close by the third quarter of 2026, even as the European commercial vehicle maker slipped into a first-quarter loss due to higher quality-related investments, bus rework costs and weakness in South America.
The company said regulatory approvals for Tata Motors’ proposed acquisition are progressing, with most clearances already received. “The last pending approvals are being actively pursued for the earliest closure,” it said. “Based on the information received from Tata Motors, the transaction is expected to close by the third quarter of 2026,” Chief Executive Officer Olof Persson said.
The quarter also marked the completion of the sale of Iveco’s defence business to Leonardo SpA, which generated net proceeds of about €1.6 billion. Iveco paid an extraordinary interim dividend of €1.55 billion in April from the proceeds of the transaction.
Iveco swings to Q1 loss amid quality push
The commercial vehicle maker reported a consolidated EBIT loss of €109 million in Q1 2026 against a profit of €54 million in Q1 2025, while adjusted EBIT fell to a loss of €55 million from a profit of €117 million a year earlier. Net loss from continuing operations stood at €116 million, compared with a profit of €14 million in the year-ago quarter. Adjusted net loss came in at €74 million, against an adjusted net profit of €60 million in Q1 2025.
Revenue, however, remained broadly stable. Consolidated net revenues rose marginally to €2.83 billion from €2.81 billion a year earlier, supported by stronger bus volumes. “In the first quarter Iveco Group further strengthened its focus on quality, making a short-term impact on profitability, but driving long-term positive effects on our products and services,” Persson said. “Through targeted investments and operational measures, we are laying stronger foundations for future growth and lasting performance,” he added.
South America slowdown hurts truck margins
Iveco’s truck division remained under pressure during the quarter despite stable European demand trends. Truck revenue declined 7.8 per cent year-on-year to €1.81 billion, while adjusted EBIT swung to a loss of €71 million from a profit of €58 million a year earlier. The adjusted EBIT margin fell to negative 3.9 per cent from positive 3 per cent.
The company said profitability was impacted by lower volumes and an adverse mix in South America, along with higher production costs linked to its quality improvement measures. While the European truck market grew 9 per cent during the quarter, South American demand weakened sharply, with medium- and heavy-duty truck markets declining 18 per cent year-on-year.
Still, order momentum in Europe remained healthy. Iveco said European light commercial vehicle order intake rose 31 per cent, while medium- and heavy-duty orders increased 5 per cent during the quarter.
Bus business grows, but rework costs weigh
The bus division delivered one of the strongest volume performances in the quarter, with revenues rising 28.9 per cent to €616 million. Deliveries rose 26 per cent in Europe and 97 per cent in South America. However, adjusted EBIT in the segment dropped to €1 million from €26 million a year ago as the company incurred rework costs tied to unfinished city buses carried over from 2025.
Persson said IVECO BUS “won the number one position in the electric vehicle European market” during the quarter and consolidated its overall No. 2 market position with nearly 23 per cent market share. “We have already deployed a significant amount of these unfinished products and will fully deploy the remainder by the end of the second quarter, ahead of plan, eliminating rework cost impacts in the second half of the year,” he said.