expectations by delivering the highest-quality products and services in our history. 

PACCAR’s product quality continued to be recognized as the industry leader in 2011. Kenworth earned the J.D. Power Heavy Duty Customer Satisfaction award for Dealer Service. Peterbilt earned honors in the Heavy Duty Vocational category. Kenworth’s T700, powered by the PACCAR MX engine, earned the American Truck Dealers heavy-duty “Commercial Truck of the Year” award. 

Nearly 55% of PACCAR’s revenue was generated outside the United States. The company has realized excellent synergies globally in product development, sales and finance activities, purchasing and manufacturing. 

DAF maintained its leadership in the tractor market and achieved a record 15.5% share in the overall European 15+ tonne market. The PACCAR MX engine has been honored as best-in-class at the Shanghai Bus Show five years in a row. 

Leyland Trucks is the United Kingdom’s leading truck manufacturer. Leyland earned two prestigious manufacturing awards in 2011 — the Shingo Bronze Medallion and the “Business Development and Change Award” at the annual Manufacturing Excellence Awards. 

PACCAR Mexico (KENMEX) had a record year as the Mexican economy improved and truck fleets increased their purchases. Its manufacturing facility continues to deliver outstanding product quality. 

PACCAR Australia achieved good results in 2011, as the country benefited from ongoing commodity demand. The introduction of new Kenworth models and expansion of the DAF product range in Australia combined for a 20.4% heavy duty market share in 2011. 

AFTERMARKET CUSTOMER SERVICES  — PACCAR Parts had a record year in 2011, as dealers and customers embraced vehicle maintenance programs, integrated customer logistics and billing systems. With sales of $2.6 billion, PACCAR Parts is the primary source for aftermarket parts and services for PACCAR vehicles, as well as supplying parts for competitive brands to PACCAR’s dealers around the world. Over six million heavy duty trucks operate in North America and Europe, and the average age of North American vehicles is estimated to be seven years. The large vehicle parc and aging industry fleet create excellent demand for parts 

and service and moderate the cyclicality of truck sales. 

PACCAR Parts expanded its facilities to enhance logistics performance to dealers and customers. 

PACCAR Parts continues to lead the industry with technology that offers competitive advantages at PACCAR dealerships. PACCAR Parts enhanced its TRP program, an all-brands merchandise initiative targeted at competitors’ vehicles. PACCAR Parts’ new Santiago, Chile, distribution center enhanced its business with Andean customers. 

FINANCIAL SERVICES  — PACCAR Financial Services’ (PFS) conservative business approach, coupled with PACCAR’s superb S&P credit rating of A+ and the strength of the dealer network, enabled PFS to earn excellent results in 2011 as worldwide financial markets steadily improved. PACCAR issued $982 million in medium-term notes at attractive rates during the year. 

The PACCAR Financial Services group of companies has operations covering three continents and 21 countries. 

The global breadth of PFS and its rigorous credit application process support a portfolio of nearly 145,000 trucks and trailers, with total assets of $9.4 billion that earned a pretax profit of $236 million. PACCAR Financial Corp. (PFC) is the preferred funding source in North America for Peterbilt and Kenworth trucks, financing 24% of dealer Class 8 sales in the U.S. and Canada in 2011. Interactive webcasts, strategically located used truck centers and target marketing enabled PFS to sell over 8,600 used trucks worldwide. 

PACCAR Financial Europe (PFE) completed its tenth year of operation, focusing on the financing of new and used DAF trucks. PFE provides wholesale and retail financing for DAF dealers and customers in 16 European countries and financed over 23% of DAF’s 6+ tonne vehicle sales in 2011. 

PACCAR Leasing (PacLease) had a record year and placed 6,700 new PACCAR vehicles in service in 2011. 

The North American lease market improved and PacLease Europe benefited as the German truck market strengthened. The PacLease fleet is over 32,000 vehicles. 

PacLease represents one of the largest full-service truck rental and leasing operations in North America and continued to increase its market presence in 2011, growing its global network to 500 locations. 

