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What changed in OSHKOSH CORP's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of OSHKOSH CORP's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+387 added−425 removedSource: 10-K (2025-02-20) vs 10-K (2024-02-29)

Top changes in OSHKOSH CORP's 2024 10-K

387 paragraphs added · 425 removed · 278 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

97 edited+30 added−46 removed48 unchanged
Biggest changeOshkosh’s competitors for ARFF vehicle sales are Rosenbauer International AG and E-One, Inc. The Company produces refuse collection vehicles for North America and international markets under the McNeilus brand. Competitors in the refuse collection vehicles market include The Heil Company (a subsidiary of Dover Corporation), New Way Trucks, Labrie Enviroquip Group (owned by Wynnchurch Capital) and other regional competitors.
Biggest changeCompetitors in the refuse and recycling collection vehicles market include Environmental Solutions Group (a subsidiary of Terex Corporation), New Way Trucks, Labrie Enviroquip Group (owned by Wynnchurch Capital) and other regional competitors. The principal methods of competition are product innovation, quality and performance, service and price. The Company competes for municipal business and large commercial business in the Americas.
Access customers include equipment rental companies, construction contractors, manufacturing companies and home improvement centers. JLG’s products are marketed worldwide through independent rental companies and distributors that purchase these products and then rent or sell them and provide service support, as well as through other sales and service branches or organizations.
Access customers include equipment rental companies, distributors, construction contractors, manufacturing companies and home improvement centers. JLG's products are marketed worldwide through independent rental companies and distributors that purchase these products and then rent or sell them and provide service support, as well as through other sales and service branches or organizations.
The team is comprised of members with diverse backgrounds in quality, lean, data analytics, product and process engineering, and culture change management. Simplification includes lean tools to eliminate waste and to provide better value for customers. It also guides customer satisfaction assessments to help identify opportunities to improve the customer experience with the Company.
The team is comprised of members with diverse backgrounds in quality, lean, data analytics, product and process engineering, and culture change management. Simplification includes lean tools to eliminate waste and provide better value for customers. It also guides customer satisfaction assessments to help identify opportunities to improve the customer experience with the Company.
(a subsidiary of Linamar Corporation), Haulotte Group, Xuzhou Construction Machinery Group Co., Ltd. (XCMG), Zhejiang Dingli Machinery Co., Ltd. and numerous other manufacturers. Global competition for sales of telehandler equipment includes J C Bamford Excavators Ltd., the Manitou Group, Merlo SpA, Genie Industries, Inc., Haulotte Group, Skyjack Inc. and numerous other manufacturers.
(a subsidiary of Linamar Corporation), Haulotte Group, Xuzhou Construction Machinery Group Co., Ltd. (XCMG), Zhejiang Dingli Machinery Co., Ltd. and numerous other manufacturers. Global competition for sales of telehandler equipment includes J C Bamford Excavators Ltd., the Manitou Group, Merlo SpA, Genie Industries, Inc., Skyjack Inc. and numerous other manufacturers.
In addition, 10 payments to contractors for services performed during a federal government shutdown may be delayed, which would have a negative effect on the Company’s cash flows. Contract awards that Oshkosh Defense receives may be subject to protests by competing bidders.
In addition, payments to contractors for services performed during a federal government shutdown may be delayed, which would have a negative effect on the Company’s cash flows. 10 Contract awards that Oshkosh Defense receives may be subject to protests by competing bidders.
These protests, if successful, could result in the customer revoking part or all of any defense contract it awards to Oshkosh Defense and an inability on the part of Oshkosh Defense to recover amounts it has expended during the protest period in anticipation of initiating work under any such contract.
These protests, if successful, could result in the customer revoking part or all of any contract it awards to Oshkosh Defense and an inability on the part of Oshkosh Defense to recover amounts it has expended during the protest period in anticipation of initiating work under any such contract.
The Company believes that its competitive strengths include: strategic global purchasing capabilities; extensive pricing/costing and defense contracting expertise; a significant installed base of vehicles currently in use throughout the world; flexible and high-efficiency vertically-integrated manufacturing capabilities; patented and/or proprietary vehicle components such as the TAK-4 family of independent suspension systems, Oshkosh power transfer cases and Command Zone integrated vehicle diagnostics; weapons and communications integration; ability to develop new and improved product capabilities responsive to the needs of its customers; product quality; and aftermarket parts sales and service capabilities.
The Company believes that its competitive strengths include: 9 strategic global purchasing capabilities; extensive pricing/costing and defense contracting expertise; a significant installed base of vehicles currently in use throughout the world; flexible and high-efficiency vertically-integrated manufacturing capabilities; patented and/or proprietary vehicle components such as the TAK-4 family of independent suspension systems, Oshkosh power transfer cases and Command Zone integrated vehicle diagnostics; weapons and communications integration; ability to develop new and improved product capabilities responsive to the needs of its customers; product quality; and aftermarket parts sales and service capabilities.
IMT is a manufacturer of field service vehicles and truck-mounted cranes for the construction, equipment dealer, building supply, utility, tire service, railroad and mining industries. IMT’s principal field service vehicle competition is from Auto Crane Company (owned by Ramsey Industries, Inc.), Stellar Industries, Inc., Maintainer Corporation of Iowa, Inc., the Knapheide Manufacturing Company and other regional companies.
IMT is a manufacturer of field service vehicles and truck-mounted cranes for the construction, equipment dealer, rental, building supply, utility, tire service, railroad and mining industries. IMT’s principal field service vehicle competition is from Auto Crane Company (owned by Ramsey Industries, Inc.), Stellar Industries, Inc., Maintainer Corporation of Iowa, Inc., the Knapheide Manufacturing Company and other regional companies.
The Company has developed global sourcing strategies to meet its production needs while building upon long-term supplier relationships and leveraging the scale of its enterprise. The supply base is expected to maintain or continuously improve levels of quality, delivery, cost and the agility to meet changes in market demands.
The Company has developed global sourcing strategies to meet its production needs while building upon long-term supplier relationships and leveraging the scale of its enterprise. The supply base is expected to maintain or continuously improve levels of quality, delivery time, cost and the agility to meet changes in market demands.
Facilities for the majority of AeroTech and the following brands are ISO 9001 certified: JLG, Jerr-Dan, Hinowa, Oshkosh Defense, Pierce, McNeilus, Maxi-Metal, Frontline Communications and Oshkosh Airport Products. The Company has a team of employees dedicated to leading the implementation of the Company’s simplification initiatives.
Facilities for the majority of AeroTech and Oshkosh Defense and the following brands are ISO 9001 certified: JLG, Jerr-Dan, Hinowa, AUSA, Pierce, Maxi-Metal, Oshkosh Airport Products, McNeilus and Frontline Communications. The Company has a team of employees dedicated to leading the implementation of the Company’s simplification initiatives.
While Oshkosh Defense sells a substantial portion of its domestic defense products directly to principal branches of the DoD, it also sells defense products to numerous international governments around the globe. Oshkosh Defense locates its business development, consultants and engineering professionals near its customers’ principal commands, both domestically and internationally.
Defense segment. While Oshkosh Defense sells a substantial portion of its domestic defense products directly to principal branches of the DoD, it also sells defense products to numerous international governments around the globe. Oshkosh Defense locates its business development, consultants and engineering professionals near its customers’ principal commands, both domestically and internationally.
To reduce production costs, the Company maintains a continuing emphasis on the development of proprietary components, self-sufficiency in fabrication, just-in-time inventory management, improvement in production flows and interchangeability of components among product lines, creation of jigs and fixtures to ensure repeatability of quality processes, utilization of robotics, and performance measurement to assure progress toward cost reduction targets.
To reduce production costs, the Company maintains a continuing emphasis on the development of proprietary components, self-sufficiency in fabrication, just-in-time inventory management, improvement in production flows and interchangeability of components among product lines, creation of jigs and fixtures to ensure repeatability of quality processes, utilization of robotics, and performance measurements to assure progress toward cost reduction targets.
The Company believes that its competitive strengths include: recognized, premium brand name; nationwide network of independent Pierce dealers; extensive, high-quality and innovative product offerings, which include single-source customer solutions for aerials, pumpers and rescue units; large-scale and high-efficiency custom manufacturing capabilities; and proprietary technologies such as the PUC vehicle configuration, TAK-4 independent suspension system, Hercules and Husky foam systems, Command Zone electronics, Volterra parallel-electric drivetrain and the Ascendant family of aerial fire trucks.
The Company believes that its 8 competitive strengths include: recognized, premium brand name; nationwide network of independent Pierce dealers; extensive, high-quality and innovative product offerings, which include single-source customer solutions for aerials, pumpers and rescue units; large-scale and high-efficiency custom manufacturing capabilities; and proprietary technologies such as the Pierce Ultimate Configuration (PUC), TAK-4 independent suspension system, Hercules and Husky foam systems, Command Zone electronics, Volterra parallel-electric drivetrain and the Ascendant family of aerial fire trucks.
Through AeroTech, the Company is a leading designer and manufacturer of aviation ground support products and gate equipment for commercial airlines, airports, air freight carriers, ground handling and military customers. AeroTech specializes in special purpose aviation ground support products such as cargo loaders and push-back tractors for airlines and air cargo companies.
Through AeroTech, the Company is a leading designer and manufacturer of aviation ground support products and gate equipment for commercial airlines, airports, air freight carriers, ground handling and military customers. AeroTech specializes in special purpose aviation ground support products such as cargo loaders, push-back tractors and deicer trucks for airlines and air cargo companies.
In addition, sales are generally lower in the three 13 months ended December 31 in all segments due to the relatively high number of holidays in the United States, which reduce available production and shipping days. Available Information The Company maintains a website with the address www.oshkoshcorp.com .
Sales are generally lower in the three months ended December 31 in all segments due to the relatively high number of holidays in the United States, which reduce available production and shipping days. Available Information The Company maintains a website with the address www.oshkoshcorp.com .
Quality Products and Customer Service. The Company has developed strong brand recognition for its products as a result of its commitment to meet the stringent product quality and reliability requirements of its customers in the purpose-built vehicle and equipment markets it serves.
The Company has developed strong brand recognition for its products as a result of its commitment to meet the stringent product quality and reliability requirements of its customers in the purpose-built vehicle and equipment markets it serves.
The Company believes Jerr-Dan is recognized as an industry leader in quality and innovation. Jerr-Dan offers a broad line of carriers, wreckers and rotators. In addition to manufacturing equipment, Jerr-Dan provides its customers with one-stop service support and generates revenue from the installation of equipment, as well as the sale of chassis and service parts. Defense segment.
The Company believes Jerr-Dan is recognized as an industry leader in quality and innovation. Jerr-Dan offers a broad line of carriers, wreckers and rotators. 3 In addition to manufacturing equipment, Jerr-Dan provides its customers with one-stop service support and generates revenue from the installation of equipment, as well as the sale of chassis and service parts. Vocational segment.
Pierce’s fire apparatus are sold through an extensive network of independent sales and service organizations with hundreds of sales representatives in the U.S. and Canada, which combine broad geographical reach with high frequency of contact with fire departments and municipal government officials. These sales and service organizations are supported by product and marketing support professionals and contract administrators at Pierce.
Pierce’s fire apparatus are sold through an extensive network of independent dealers with hundreds of sales representatives in the U.S. and Canada, which combine broad geographical reach with high frequency of contact with fire departments and municipal government officials. These dealers are supported by product and marketing support professionals and contract administrators at Pierce.
Oshkosh Defense designs and manufactures vehicles that perform a variety of demanding tasks such as hauling tanks, missile systems, ammunition, fuel, troops and cargo for a broad range of missions.
Oshkosh Defense designs and manufactures vehicles that perform a variety of demanding tasks such as hauling combat vehicles, missile systems, ammunition, fuel, troops and cargo for a broad range of missions.
The Company typically provides credit support in connection with these financing and leasing arrangements. The Company also arranges equipment financing and leasing solutions for its other Vocational segment customers, primarily through third-party funding arrangements with independent financial companies, and occasionally provides credit support in connection with these financing and leasing arrangements.
The Company also arranges equipment financing and leasing solutions for its other Vocational segment customers, primarily through third-party funding arrangements with independent financial companies, and occasionally provides credit support in connection with these financing and leasing arrangements. 4 Defense segment.
Oshkosh Defense’s proprietary product line of military heavy-payload tactical wheeled vehicles includes the Heavy Expanded Mobility Tactical Truck (HEMTT), the Heavy Equipment Transporter (HET), the Palletized Load System (PLS), and the Logistic Vehicle System Replacement (LVSR). Oshkosh Defense’s proprietary medium-payload military tactical wheeled vehicles include the Medium Tactical Vehicle Replacement (MTVR).
Oshkosh Defense’s proprietary product line of military heavy-payload tactical wheeled vehicles includes the Heavy Expanded Mobility Tactical Truck (HEMTT), Heavy Equipment Transporter (HET), the Palletized Load System (PLS) and the Logistic Vehicle System Replacement (LVSR).
Competition for sales of these vehicles includes, among others, Navistar Defense LLC (a subsidiary of Cerberus Capital Management, LP), General Dynamics Corporation, AM General LLC (a subsidiary of KPS Capital Partners, LP), BAE Systems 8 plc and General Motors Defense.
Competition for sales of these vehicles includes, among others, Navistar Defense LLC (a subsidiary of Cerberus Capital Management, LP), General Dynamics Corporation, AM General LLC (a subsidiary of KPS Capital Partners, LP), Mack Defense LLC and BAE Systems plc.
With respect to acquired properties and businesses, the Company conducts due diligence into potential exposure to environmental liabilities but cannot be certain that it has identified or will identify all adverse environmental conditions. We believe that our policies, practices, and procedures are properly designed to prevent unreasonable risk of environmental damage and the consequent financial liability to the Company.
With respect to acquired properties and businesses, the Company conducts due diligence into potential exposure to environmental liabilities but cannot be certain that it has identified or will identify all adverse environmental conditions. The Company believes that its policies, practices, and procedures are properly designed to prevent unreasonable risk of environmental damage and the consequent financial liability to the Company.
Seasonal Nature of Business The Company’s JLG business tends to be seasonal with an increase in sales occurring in the spring and summer months that constitute the traditional construction season in the northern hemisphere.
Seasonal Nature of Business The Company’s Access segment tends to be seasonal with an increase in sales occurring in the spring and summer months that constitute the traditional construction season in the northern hemisphere.
In addition, we maintain a global ethics and compliance helpline to allow for concerns of potential violations of the Code, global policies, or the law to be reported. The Company’s connections to its communities through charitable giving, leadership and volunteering efforts have long been an important part of the Company’s culture and team member engagement.
In addition, the Company maintains a global ethics and compliance helpline to allow for concerns of potential violations of the Code, global policies, or the law to be reported anonymously. The Company’s connections to its communities through charitable giving, leadership and volunteering efforts have long been an important part of the Company’s culture and team member engagement.
Components for the Company’s products are generally available from a number of suppliers, although some sole sourced components would require additional time to transition. The Company also purchases complete vehicle chassis from truck chassis suppliers in its Access and Vocational segments.
Components for the Company’s products are generally available from numerous suppliers, although some sole sourced components would require additional time to transition. The Company also purchases complete vehicle chassis from truck chassis suppliers in its Access and Vocational segments.
The Company maintains leading market shares in nearly all of its businesses and is the sole-source supplier of a number of vehicles to the DoD. Diversified Product Portfolios.
The Company maintains a leading market share in nearly all of its businesses and is the sole-source supplier of a number of vehicles to the DoD. 2 Diversified Product Portfolios.
The Company encourages employee involvement to improve production processes and product quality. The Company uses a common Quality Management System globally to support the delivery of consistent, high-quality products and services to customers.
The Company encourages employee involvement to improve production processes and product quality. 6 The Company uses a Quality Management System to support the delivery of consistent, high-quality products and services to customers.
Access segment. JLG operates in the global construction, maintenance and industrial equipment markets. JLG’s competitors range from some of the world’s largest multi-national construction equipment manufacturers to small single-product niche manufacturers. Within this global market, competition for sales of aerial work platform equipment includes Genie Industries, Inc. (a subsidiary of Terex Corporation), Skyjack Inc.
Access segment. JLG operates in the global construction, maintenance, agricultural, vegetation management and industrial equipment markets. JLG’s competitors range from some of the world’s largest multinational construction equipment manufacturers to small single-product niche manufacturers. Within this global market, competition for sales of aerial work platform equipment includes Genie Industries, Inc. (a subsidiary of Terex Corporation), Skyjack Inc.
Business Strategy The Company's business strategy is grounded in the Company's purpose of making a difference in the lives of the people in our communities who do the toughest work. The strategy is reflected in three simple words: Innovate. Serve. Advance. I nnovate.
Business Strategy The Company's business strategy is grounded in the Company's purpose of making a difference in the lives of the people in our communities who do tough work. The strategy is reflected in three simple words: Innovate. Serve. Advance. Innovate .
The Company believes the geographic breadth, size and quality of its Pierce fire apparatus sales and service organization are competitive advantages in a market characterized by a few large manufacturers and numerous small, regional competitors.
The Company believes the geographic breadth, size and quality of its Pierce fire apparatus dealer network are competitive advantages in a market characterized by a few large manufacturers and numerous small, regional competitors.
Our technology and product development teams include more than 1,800 talented engineers with expertise across many disciplines including vehicle design, simulation, software and electronics. As a leading industrial technology company, we have facilities around the world with extensive research and development capabilities. Our team members are committed to building safer, more responsible machines.
The Company's technology and product development teams include more than 1,900 talented engineers with expertise across many disciplines including vehicle design, simulation, software and electronics. As a leading industrial technology company, the Company has facilities around the world with extensive research and development capabilities. Our team members are committed to building safer, more productive machines.
In an effort to be a single-source supplier for its customers, Pierce offers a full line of custom and commercial fire apparatus and emergency vehicles, including pumpers, aerial platforms, ladder and tiller trucks, tankers, light-, medium- and heavy-duty rescue vehicles, wildland rough terrain response vehicles, mobile command and control centers, bomb squad vehicles, hazardous materials control vehicles and other emergency response vehicles.
In an effort to be a single-source supplier for its customers, Pierce offers a full line of custom and commercial fire apparatus and emergency vehicles, including pumpers, aerial platforms, ladder and tiller trucks, tankers, light-, medium- and heavy-duty rescue vehicles, wildland rough terrain response vehicles and other emergency response vehicles.
The Company makes available free of charge (other than an investor’s own Internet access charges) through its website its Annual Report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and amendments to these reports, as soon as reasonably practicable after the Company electronically files such materials with, or furnishes such materials to, the Securities and Exchange Commission (SEC).
The Company makes available free of charge through its website its Annual Report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and amendments to these reports, as soon as reasonably practicable after the Company electronically files such materials with, or furnishes such materials to, the Securities and Exchange Commission (SEC).
The Company believes it is uniquely positioned to transition technology and deliver new products at greater speed across our businesses to create differentiation within the markets we serve.
The Company believes it is uniquely positioned to transition technology and deliver new products at great speed across our businesses to create differentiation within the markets it serves.
Government Contracts Approximately 19% of the Company’s net sales for fiscal 2023 were made to the U.S. government, a substantial majority of which were under multi-year contracts and programs in the defense vehicle market.
Government Contracts Approximately 20% of the Company's sales for 2024 were made to the U.S. government, a substantial majority of which were under multi-year contracts and programs in the defense vehicle market.
The Company focuses on protecting the health and safety of its team members. The Company takes a proactive collaborative approach to managing safety to ensure our workforce returns home safely each and every day. Safety Management System maturity, OSHA VPP Star progression, ergonomic advancements and active team member involvement have led to improved risk reduction within our operations.
The Company takes a proactive collaborative approach to managing safety to ensure its workforce returns home safely every day. Safety Management System maturity, OSHA VPP Star progression, ergonomic advancements and active team member involvement have led to improved risk reduction within the Company's operations.
The Company serves and supports customers with a relentless focus throughout the product lifecycle. The Company believes that lifecycle services provide a robust growth opportunity while offering stability throughout business cycles. 2 A dvance. The Company advances by expanding into new markets and geographies to make a difference around the world.
The Company serves and supports customers with a relentless focus throughout the product lifecycle. The Company believes that lifecycle services provide a robust growth opportunity while offering stability throughout business cycles. Advance . The Company advances by expanding into new markets and geographies to move the world forward.
Principal methods of competition are price, service, product features, product quality and product availability. The Company believes its competitive strengths include: strong brand recognition; large-scale and high-efficiency manufacturing; product innovation; high product quality; innovative control systems; a significant installed base of front-discharge concrete mixers in use in the marketplace; and its nationwide network of sales and service centers.
Competition for front-discharge concrete mixers includes Terex Corporation. Principal methods of competition are price, service, product features, product quality and product availability. The Company believes its competitive strengths include: strong brand recognition; large-scale and high-efficiency manufacturing; product innovation; high product quality; innovative control systems and a significant installed base of front-discharge concrete mixers in use in the marketplace. Defense segment.
The Company’s teams creatively identified opportunities to volunteer in fiscal 2023 donating over 21,300 hours to the communities in which they live and work.
The Company’s teams creatively identified opportunities to volunteer in 2024 donating over 22,300 hours to the communities in which they live and work.
Marketing, Sales, Distribution and Service The Company believes it differentiates itself from many of its competitors by tailoring its distribution to the needs of its purpose-built vehicle and equipment markets and with its national and global sales and service capabilities. Distribution personnel demonstrate to customers how to use the Company’s products properly.
Marketing, Sales, Distribution and Service The Company believes it differentiates itself from many of its competitors by tailoring its distribution to the needs of its purpose-built vehicle and equipment markets and with its national and global sales and service capabilities.
The Company innovates customer solutions by combining leading technology and operational strength to empower and protect the everyday hero. The Company is developing and integrating advanced technologies to fulfill its purpose in areas such as electrification, autonomy and active safety as well as intelligent and connected products. S erve.
The Company innovates customer solutions by combining leading technology and operational strength to empower and protect the everyday hero. The Company is developing and integrating advanced technologies to expand production output, improve profit margins and fulfill its purpose in areas such as electrification, autonomy and connected products. Serve .
The Company offers a competitive, inclusive and empowering benefit platform to help ensure that no matter where team members are in their wellbeing journey, they are supported in their physical, financial and emotional goals. In fiscal 2023, the Company cared for over 25,000 team members and their families on its medical plan.
The Company offers a competitive benefit platform to help ensure that, no matter where team members are in their well-being journeys, they are supported in their physical, financial and emotional goals. In 2024, the Company cared for over 26,000 people, including team members and their families, on its medical plan.
For the last 10 years, the Company has held the Oshkosh Excellence Awards (OEAs), an annual competition and recognition event that invites team members to submit innovative ideas to foster improvements for its culture, operations, products and customers.
For the last 11 years, the Company has held the Oshkosh Excellence Awards (OEAs), an annual competition and recognition event that invites team members to submit innovative ideas to foster improvements for its culture, operations, products and customers. Over 600 OEA nominations were submitted in 2024. 12 Talent and Learning .
The Company produces and sells command vehicles in the U.S. and abroad under the Frontline Communications brand. The principal competition for command vehicles is LDV, Inc., MBF Industries, Inc., Nomad Global Communication Solutions, Incorporated, Farber Specialty Vehicles, Inc. and Matthews Specialty Vehicles, Inc. Airport Products manufactures ARFF vehicles for sale in the U.S. and abroad.
The Company also produces and sells command vehicles in the U.S. and abroad under the Frontline Communications brand. The principal competition for command vehicles is LDV, Inc., MBF Industries, Inc., Nomad Global Communication Solutions, Incorporated, Farber Specialty Vehicles, Inc. and Matthews Specialty Vehicles, Inc. The Company produces front-discharge concrete mixers for the Americas under the Oshkosh S-Series brand.
For each of its target markets, the Company has developed advanced technology or acquired a broad product line in an effort to become a single-source provider of purpose-built vehicles and equipment, parts and service to support its customers. In addition, the Company has established an extensive domestic and international distribution network for purpose-built vehicles and equipment tailored to each market.
For each of its target markets, the Company has developed advanced technology or acquired a broad product line in an effort to become a supplier of choice for purpose-built vehicles and equipment, parts and service to support its customers.
Principal methods of competition for carriers, wreckers and rotators include product quality and innovation, product performance, price and service. The Company believes its competitive strengths in this market include its high-quality, innovative and high-performance product line and its cost competitive manufacturing capabilities. Defense segment. Oshkosh Defense produces heavy- and medium- and light-payload tactical wheeled vehicles for militaries around the world.
Principal methods of competition for carriers, wreckers and rotators include product quality and innovation, product performance, price and service. The Company believes its competitive strengths in this market include its high-quality, innovative and high-performance product line and its cost competitive manufacturing capabilities. Vocational segment.
If more stringent environmental laws are enacted in the future, these laws could have a material adverse impact on our business, results of operations, and financial condition. Human Capital Management As of December 31, 2023, the Company had approximately 17,300 employees, approximately 10,800 of whom are production employees.
If more stringent environmental laws are enacted in the future, these laws could have a material adverse impact on our business, results of operations and financial condition Human Capital Management As of December 31, 2024, the Company had approximately 18,500 employees, approximately 11,800 of whom are production employees. Approximately 2,100 (14%) of the Company's U.S. employees were represented by unions.
Nevertheless, we could incur substantial costs as a result of non-compliance with or liability for cleanup or other costs or damages under environmental laws. Also, we may be subject to other more stringent environmental laws in the future.
Nevertheless, the Company could incur substantial costs as a result of non-compliance with or liability for cleanup or other costs or damages under environmental laws. The Company has established emissions reduction targets that were approved by the Science Based Targets Initiative (SBTi). The Company may also be subject to other more stringent environmental laws in the future.
Oshkosh Defense maintains a large parts distribution warehouse in Milwaukee, Wisconsin to fulfill stringent parts delivery schedule requirements, as well as satellite facilities near DoD bases in the U.S., Europe, Asia and the Middle East. Vocational segment.
Oshkosh Defense maintains a large parts distribution warehouse in Milwaukee, Wisconsin to fulfill stringent parts delivery schedule requirements, as well as satellite facilities near DoD bases in the U.S. and abroad. Manufacturing The Company manufactures its products at 31 manufacturing facilities.
The Company is led by President and Chief Executive Officer John Pfeifer. Mr. Pfeifer is complemented by an experienced senior management team that has been assembled through internal promotions and external hires. The Company’s Board of Directors maintains a robust succession planning process for its executive officers to ensure strong business continuity.
Pfeifer is complemented by an experienced senior management team that has been assembled through internal promotions and external hires. The Company’s Board of Directors maintains a robust succession planning process for its executive officers to ensure strong business continuity. Products Oshkosh Corporation is focused on the following purpose-built vehicle and equipment markets: Access segment.
Oshkosh Defense sells and services defense products to approved international governments as Direct Commercial Sales or Foreign Military Sales via U.S. government channels. Oshkosh Defense supports international sales through international sales offices, as well as through dealers, distributors and representatives. Logistics services are increasingly important to Oshkosh Defense.
Oshkosh Defense sells and services defense products to approved international governments as Direct Commercial Sales or Foreign Military Sales via U.S. government channels. Oshkosh Defense supports international sales through international sales offices, as well as through dealers, distributors and representatives. The Company believes that its proven worldwide logistics capabilities are critical in supporting its defense parts and service business.
The Company expanded paid parental leave benefits to support team members as they grow their families. In addition, the Company supported team members’ investment in their health by providing a financial incentive to complete an annual preventive exam. The Company has set several goals and benchmarks for Diversity, Equity and Inclusion (DEI) performance, using both internal goals and federal standards.
The Company expanded paid parental leave benefits to support team members as they grow their families. In addition, the Company supported team members’ investment in their health by providing a financial incentive to complete an annual preventive exam.
The Company is also a leading supplier of military simulator shelters and trailers under the Oshkosh Specialty Vehicles (OSV) brand. The Company’s command vehicles have supported disaster relief efforts for FEMA and everyday incident response for federal and local law enforcement, emergency management agencies and fire departments.
Through its Frontline Communications business, the Company is a leading manufacturer, system designer and integrator of command trucks and military simulator shelters and trailers. The Company’s vehicles have supported disaster relief efforts for the Federal Emergency Management Agency (FEMA) and everyday incident response for federal and local law enforcement, emergency management agencies and fire departments.
Recent product launches include the Pierce Volterra, North America’s first electric fire truck; the McNeilus Volterra, North America’s first fully integrated electric refuse collection vehicle; the JLG DaVinci lift, the world’s first all-electric scissor lift; and JLG ClearSky Smart Fleet, the construction industry’s first two-way fleet management and communication platform.
Recent product launches include the Pierce Volterra, North America’s first electric fire truck; the Striker Volterra Electric ARFF, an electric ARFF vehicle with advanced electric vehicle battery technology; the McNeilus Volterra ZSL and ZFL, North America’s first fully integrated electric refuse and recycling collection vehicles; the JLG DaVinci lift, the world’s first all-electric scissor lift; JLG ClearSky Smart Fleet, the construction industry’s first two-way fleet management and communication platform; and the NGDV, a delivery vehicle that leverages advanced technologies, sustainability and operational efficiency.
Partnerships with leading universities such as Massachusetts Institute of Technology, Carnegie Mellon University and the University of Wisconsin - Madison, as well as our corporate venture capital investments, give us access to cutting edge research and a robust talent pipeline.
The Company's acquisition of Pratt Miller, a leader in autonomous and connected systems, expanded its technological capabilities, and partnerships with leading universities such as Massachusetts Institute of Technology, Carnegie Mellon University and the University of Wisconsin- Madison, as well as the Company's corporate venture capital investments, give it access to cutting edge research, a robust talent pipeline and early access to disruptive technologies.
The Company believes its competitive strengths in the Americas refuse collection vehicle markets include: strong brand recognition; innovative and comprehensive product offerings; a reputation for high-quality products; ability to offer factory-installed compressed natural gas fuel systems; ability to integrate refuse collection bodies with electric chassis; the offering of a fully integrated electric refuse vehicle; large-scale and high-efficiency manufacturing; and an extensive network of sales and service centers located throughout the U.S.
The Company believes its competitive strengths in the Americas refuse and recycling collection vehicle markets include: strong brand recognition; enhanced safety features; innovative and comprehensive product offerings; product lifecycle support; a reputation for high-quality products; ability to integrate refuse and recycling collection bodies with alternative fuel technology chassis; the offering of a fully integrated electric refuse vehicle; large-scale and high-efficiency manufacturing; and a nationwide network of independent dealers.
Pierce’s history of innovation, research and development in consultation with firefighters has resulted in a broad product line that features a wide range of innovative, high-quality custom and commercial firefighting equipment with advanced fire suppression capabilities.
Pierce primarily serves domestic municipal customers, but also sells fire apparatus to the DoD, airports, universities and large industrial companies, and in international markets. Pierce’s history of innovation, research and development in consultation with firefighters has resulted in a broad product line that features a wide range of innovative, high-quality custom and commercial firefighting equipment with advanced fire suppression capabilities.
The Company seeks to mitigate risks with respect to fixed-price contracts by executing firm, fixed-price contracts where possible with its suppliers of significant components for the duration of the Company’s contracts. U.S. government contracts generally permit the government to terminate a contract, in whole or part, at the government’s convenience.
The Company seeks to mitigate risks with respect to fixed-price contracts by executing firm, fixed-price contracts where possible with its suppliers of significant components for the duration of the Company’s contracts.
The Company requires all team members to complete training on our Code of Conduct referred to as “The Oshkosh Way”. The Oshkosh Way provides specific guidance to all our employees, outlining how they are expected to act with the integrity that has defined Oshkosh since we were founded over 100 years ago.
The Oshkosh Way provides specific guidance to team members, outlining how they are expected to act with the integrity that has defined Oshkosh since the Company was founded over 100 years ago.
Strategic succession planning, future leader pipelines and critical role depth were reviewed and updated during fiscal 2023. All leaders are expected to complete regular check-ins to provide feedback, review annual goal progress and hold career development conversations with team members to help ensure alignment, drive engagement and facilitate strong business outcomes. Health and Safety.
All leaders are expected to complete regular check-ins to provide feedback, review annual goal progress and hold career development conversations with team members to help ensure alignment, drive engagement and facilitate strong business outcomes. Health and Safety. The Company focuses on protecting the health and safety of its team members.
Competition for sales of delivery vehicles includes, among others, Utilimaster (a subsidiary of The Shyft Group), Morgan Olson (a subsidiary of JB Poindexter & Co., Inc.), Workhorse Group Incorporated and Rivian Automotive Inc. Vocational segment. The Company produces and sells custom and commercial firefighting vehicles in North America and abroad under the Pierce and Maxi-Metal brands.
Competition for sales of delivery vehicles includes, among others, Utilimaster (a subsidiary of The Shyft Group), Morgan Olson (a subsidiary of JB Poindexter & Co., Inc.), Workhorse Group Incorporated and Rivian Automotive Inc.
JLG’s international sales employees are spread among international sales and service offices throughout the world. 5 The Company markets its Jerr-Dan-branded carriers, wreckers and rotators through its extensive network of independent distributors. Defense segment.
JLG maintains a broad worldwide internal sales force. Sales employees are dedicated to specific major customers, channels or geographic regions. JLG’s international sales employees are spread among international sales and service offices throughout the world. The Company markets its Jerr-Dan-branded carriers, wreckers and rotators through its extensive network of independent distributors. Vocational segment.
The Company maintains 12 industry-leading brands across three reportable segments: Access, Defense, and Vocational, which comprised 51%, 22%, and 27% respectively, of the Company’s consolidated net sales in fiscal 2023. Oshkosh’s leading brands include a wide range of purpose-built vehicles and equipment to serve a diverse set of end markets.
The Company has three reportable segments: Access, Vocational and Defense, which comprised 48%, 31% and 20%, respectively, of the Company’s 2024 consolidated net sales. Oshkosh’s leading brands include a wide range of purpose-built vehicles and equipment to serve a diverse set of end markets. Our innovations are scalable and adaptable, often expanding across many of our businesses.
Certain of these representatives and distributors also handle Pierce products. The Company markets its Oshkosh-branded ARFF vehicles through a combination of direct sales representatives and dealerships domestically and an extensive network of representatives and distributors in international markets. Certain of these international representatives and distributors also handle Pierce products.
AeroTech sales are conducted through a team of direct sales personnel strategically located across the globe and through an extensive network of sales agents. The Company markets its Oshkosh-branded ARFF vehicles through a combination of direct sales representatives and dealerships domestically and an extensive network of representatives and distributors in international markets.
Oshkosh Defense has designed and sold products to the DoD for over 100 years and also exports tactical wheeled vehicles to approved foreign customers. By successfully responding to the DoD’s changing vehicle requirements, Oshkosh Defense has become a leading manufacturer of heavy, medium, and light tactical wheeled vehicles and related sustainment services for the DoD.
By successfully responding to the DoD’s changing vehicle requirements, Oshkosh Defense has become a leading manufacturer of heavy, medium, and light tactical wheeled vehicles and related sustainment services, as well as a provider of next generation combat vehicle solutions for mobility, reliability and lethality, for the DoD.
See Note 24 of the Notes to Consolidated Financial Statements for financial information related to the Company’s reportable segments. The Access segment designs and manufactures access and material handling equipment for use in a wide range of construction, industrial, agricultural and maintenance applications to safely position workers and materials at height under industry-leading brands, JLG and SkyTrak.
The Access segment designs and manufactures access and material handling equipment for use in a wide range of construction, industrial, agricultural, vegetation management and maintenance applications to safely position workers and materials at height under industry-leading brands, JLG and SkyTrak. The Access segment's customer base includes equipment rental companies, construction contractors, manufacturing companies and home improvement centers.
The Company believes it has competitive advantages over larger vehicle manufacturers in its purpose-built vehicle and equipment markets due to its product quality, manufacturing flexibility and distribution networks. The Company also believes it has competitive advantages over smaller vehicle and equipment manufacturers due to volumes that offer purchasing power, technology and manufacturing sharing opportunities across product lines. Strong Management Team.
The Company also believes it has competitive advantages over smaller vehicle and equipment manufacturers due to volumes that offer purchasing power, flexible and efficient manufacturing capabilities and technology sharing opportunities across product lines. Strong Management Team. The Company is led by President and Chief Executive Officer, John Pfeifer. Mr.
AeroTech facility services also provides contracting, project management, design, and installation services for the critical and complex baggage systems and other key facility operations. Through IMT, the Company is a leading North American designer and manufacturer of field service vehicles and truck-mounted cranes for the construction, equipment dealer, building supply, utility, tire service, railroad and mining industries.
Through McNeilus, the Company is a leading designer and manufacturer of refuse and recycling collection vehicles for the waste services industry throughout the Americas. Through IMT, the Company is a leading North American designer and manufacturer of field service vehicles and truck-mounted cranes for the construction, equipment dealer, rental, building supply, utility, tire service, railroad and mining industries.
Many of the largest airports in the United States are served by the Company’s ARFF vehicles. The U.S. government also maintains a fleet of ARFF vehicles that are used to support military operations throughout the world. Internationally, the Company’s vehicles serve airports worldwide, with recent deliveries to airports in Latin America, the Middle East, the United Kingdom and China.
These highly-specialized vehicles are required to be in service at most airports worldwide to support commercial airlines in the event of an emergency. Many of the largest airports in the United States are served by the Company’s ARFF vehicles. The U.S. government also maintains a fleet of ARFF vehicles that are used to support military operations throughout the world.
Through Pierce and Maxi-Metal, the Company is the leading North American designer and manufacturer of fire apparatus assembled on custom chassis, designed and manufactured to meet the demanding requirements of firefighters. Pierce also designs and manufactures fire apparatus assembled on commercially available chassis, which are produced for multiple end-customer applications.
Through Pierce and Maxi-Metal, the Company is a leading North American designer and manufacturer of municipal fire apparatus assembled on both commercially available and custom chassis, designed and manufactured to meet the demanding requirements of firefighters. Pierce’s engineering expertise allows it to design its vehicles to meet stringent industry guidelines and government regulations for safety and effectiveness.
JLG’s products are marketed across six continents through rental companies and distributors that purchase products and then rent or sell them and provide service support, as well as through other Company owned sales and service branches. JLG maintains a broad worldwide internal sales force. Sales employees are dedicated to specific major customers, channels or geographic regions.
Dealers and representatives, except for those utilized by JLG and IMT, are generally not permitted to market and sell competitive products. Access segment. JLG’s products are marketed across six continents through rental companies and distributors that purchase products and then rent or sell them and provide service support, as well as through other Company owned sales and service branches.
By designing and building innovative products that revolutionize the way work is done, we are empowering people to be more productive, more efficient and more sustainable in what they do and how they serve. 7 The Company is securing its heritage of innovation for the future through new product research, ideation challenges, competitions and an open framework that leverages technology partners and strategic acquisitions.
The Company is securing its heritage of innovation for the future through new product research, ideation challenges, competitions and an open framework that leverages technology partners and strategic acquisitions.
The Company expects to continue to grow across the world and expand into new categories both organically, as with the USPS program win in the last mile delivery vehicle market, and inorganically through investments and acquisitions. Products Oshkosh Corporation is focused on the following purpose-built vehicle and equipment markets: Access segment.
The Company expects to continue to grow globally and expand into new categories both organically, as with the USPS program win in the delivery vehicle market, and inorganically through acquisitions. Competitive Strengths The following competitive strengths support the Company’s business strategy: Strong Market Positions.
After the sale, Pierce’s nationwide local parts and service capability is available to help municipalities maintain peak readiness for this vital municipal service. Additionally, Pierce sells fire apparatus to international municipal and industrial fire departments through a network of international dealers. The Company markets its Maxi-Metal vehicles through a combination of direct sales representatives and a network of distributors.
Pierce also sells fire apparatus to international municipal and industrial fire departments through a network of international dealers. 5 The Company markets its Maxi-Metal vehicles through a combination of direct sales representatives and a network of dealers. Some of these representatives and dealers also handle Pierce products.
This allows Oshkosh to leverage innovations and efficiencies across the enterprise, including technology, supply chain, materials integration and manufacturing processes. The Company generated approximately 19%, 25%, and 33% of its net sales for fiscal 2023, 2022 and 2021, respectively, from the U.S. government, a substantial majority of which were under multi-year contracts and programs in the defense vehicle market.
The Company generated approximately 20%, 19% and 25% of its net sales in 2024, 2023 and 2022, respectively, to the U.S. government, a substantial majority of which were under multi-year contracts and programs in the defense vehicle market. See Note 24 of the Notes to Consolidated Financial Statements for financial information related to the Company's reportable segments.
The Company offers two- to fifteen-year municipal lease financing programs to its Pierce customers in the U.S. through the Pierce Financial Solutions program, provided by PNC Equipment Finance. Financing programs include competitive lease financing rates, flexible finance arrangements and the ease of one-stop shopping to meet the finance needs of Pierce customers.
Financing programs include competitive lease financing rates, flexible finance arrangements and the ease of one-stop shopping to meet the finance needs of Pierce customers. The Company typically provides credit support in connection with these financing and leasing arrangements.
Additionally, Caterpillar Inc. assigned to JLG certain patents and patent applications relating to the Caterpillar-branded telehandler products. Environmental Matters The Company is subject to a wide variety of local, state, and federal environmental laws in the U.S., as well as in other countries where the Company conducts business.
The Company believes these investments have improved and will continue to improve the overall efficiency and performance of the business’ global supply chain. 11 Environmental Matters The Company is subject to a wide variety of local, state, and federal environmental laws in the U.S., as well as in other countries where the Company conducts business.
Terminal facilities and commercial aviation are supported by the Jetway passenger boarding bridge and related air and power products. AeroTech's facility services business specializes in the maintenance, servicing, and operation of key airport facility systems such as HVAC, gate equipment, and baggage systems.
Terminal facilities and commercial aviation are supported by the Jetway passenger boarding bridge and related air and power products.
The Company maintains a People First culture that includes investing in team members’ safety, engagement, wellbeing, and personal and professional development, as well as diversity and inclusion. The Company believes its People First culture is a strength, and the Company intends to continue building upon that culture to drive long-term, 12 sustainable performance across the business.
The Company believes its People First culture is a strength, and the Company intends to continue building upon that culture to foster innovation and drive long-term, sustainable performance across the business. In 2024, 60% of global production and office team members participated in the Company’s Global Engagement Survey. Engagement across the enterprise was 7.5 out of 10.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIn addition, payments to contractors for services performed during a federal government shutdown may be delayed, which would have a negative effect on our cash flows. • Certain of our U.S. government contracts could be delayed or terminated, and all such contracts expire in the future and may not be replaced, which could reduce revenues that we expect under the contracts and negatively affect margins in our Defense segment. 16 • Defense tactical wheeled vehicles contract awards that we receive may be subject to protests or lawsuits by competing bidders, which protests or lawsuits, if successful, could result in the U.S. government customer revoking part or all of any defense tactical wheeled vehicle contracts it awards to us and our inability to recover amounts we have expended in anticipation of initiating production under any such contract. • We must spend significant sums on product development and testing, bid and proposal activities, and pre-contract engineering, tooling and design activities in competitions to have the opportunity to be awarded these contracts. • As a U.S. government contractor, our DoD contracts and systems are subject to audit and review by the Defense Contract Audit Agency and the Defense Contract Management Agency.
Biggest changeThese laws and regulations affect how we do business with our customers and, in many instances, impose added costs on our business. • Defense tactical wheeled vehicles contract awards that we receive may be subject to protests or lawsuits by competing bidders, which protests or lawsuits, if successful, could result in the U.S. government customer revoking part or all of any defense tactical wheeled vehicle contracts it awards to us and our inability to recover amounts we have expended in anticipation of initiating production under any such contract.
Factors such as supply and demand, freight costs, availability of transportation, the cost of manufacturing labor, availability of labor, inventory levels, the level of imports, the imposition of duties and tariffs and other trade barriers and general economic conditions may affect the price of our parts, materials, components or final assembly purchases.
Factors such as the imposition of duties and tariffs and other trade barriers, supply and demand, the level of imports, freight costs, availability of transportation, the cost of manufacturing labor, availability of labor, inventory levels and general economic conditions may affect the price of our parts, materials, components or final assembly purchases.
That business is subject to the following risks, among others, that could have a material adverse effect on our operating performance: • The Weapon Systems Acquisition Reform Act and the Competition in Contracting Act require competition for U.S. defense programs in most circumstances.
That business is subject to the following risks, among others, that could have a material adverse effect on our operating performance: • The Weapon Systems Acquisition Reform Act and the Competition in Contracting Act require competition for U.S. defense programs in most circumstances. Competition for U.S.
One of our growth strategies is emphasizing our new product development as we seek to expand sales and margins by leading our core markets in the introduction of new or improved products and technologies or expanding our portfolio into adjacent markets.
One of our growth strategies is emphasizing our new product development as we seek to expand sales and margins by leading our core markets in the introduction of new or improved products and technologies or expanding our product portfolio into adjacent markets.
Our competitors’ new products may arrive in the market before our products arrive and be more attractive with more features and functions and/or lower prices than our products. If we are unable to provide continued technological improvements in our products that meet our customers’ or the industry’s expectations, then the demand for our products could be adversely affected.
Our competitors’ new products may arrive in the market before our products arrive and be more attractive with more features and functions and/or lower prices than our products. If we are unable to provide continued technological improvements in our products that meet our customers’ or the industry’s expectations, then demand for our products could be adversely affected.
Such fluctuations, in particular those with respect to the Euro, the Chinese renminbi, the Canadian dollar, the Mexican peso, the Australian dollar and the British pound sterling may have a material effect on our net sales, financial condition, profitability and/or cash flows and may significantly 19 affect the comparability of our results between financial periods.
Such fluctuations, in particular those with 19 respect to the Euro, the Chinese renminbi, the Canadian dollar, the Mexican peso, the Australian dollar and the British pound sterling may have a material effect on our net sales, financial condition, profitability and/or cash flows and may significantly affect the comparability of our results between financial periods.
In circumstances where we believe it is probable that a specific customer will have difficulty meeting its financial obligations, a specific reserve is recorded to reduce the net recognized receivable to the amount we expect to collect, and/or we recognize a liability for a guarantee we expect to pay, taking into account any amounts that we would anticipate realizing if we are forced to repossess the equipment that supports the customer’s financial obligations to us.
In circumstances where we believe it is probable that a specific customer will have difficulty meeting its financial obligations, a specific reserve is recorded to reduce the net recognized receivable to the amount we expect to collect, and/or we recognize a liability for a guarantee we 20 expect to pay, taking into account any amounts that we would anticipate realizing if we are forced to repossess the equipment that supports the customer’s financial obligations to us.
While we have relatively low turnover of dealers, from time to time, we or a dealer may choose to terminate the relationship as a result of difficulties that our independent dealers experience in operating their businesses due to economic conditions or other factors or as a result of an alleged failure by us or an independent dealer to comply with the 17 terms of our dealer agreement.
While we have relatively low turnover of dealers, from time to time, we or a dealer may choose to terminate the relationship as a result of difficulties that our independent dealers experience in operating their businesses due to economic conditions or other factors or as a result of an alleged failure by us or an independent dealer to comply with the terms of our dealer agreement.
Changes in our effective tax rate as a result of changes in tax laws or regulations and judicial or regulatory interpretations of those laws or regulations, the mix of earnings in countries with differing statutory tax rates, changes in overall profitability, changes in U.S. generally accepted accounting principles, or changes in the valuation of deferred tax assets could adversely affect our future results of operations.
Changes in our effective tax rate as a result of changes in tax laws or regulations and judicial or regulatory interpretations of those laws or regulations, the mix of earnings in 21 countries with differing statutory tax rates, changes in overall profitability, changes in U.S. generally accepted accounting principles, or changes in the valuation of deferred tax assets could adversely affect our future results of operations.
Similarly, the fire apparatus market distribution channel is comprised of a relatively small number of dealers that if they were to consolidate may create additional pricing pressure, as well as concentrated credit exposures, as our reliance on a smaller group of larger individual dealerships increases.
Similarly, the municipal fire apparatus market distribution channel is comprised of a relatively small number of dealers that, if they were to consolidate, may create additional pricing pressure, as well as concentrated credit exposures, as our reliance on a smaller group of larger individual dealerships increases.
If these audits result in assessments 21 different from amounts that the Company has reserved for potential tax liabilities, future financial results may include unfavorable adjustments to the Company’s tax liabilities, which could have a material adverse effect on the Company’s results of operations.
If these audits result in assessments different from amounts that the Company has reserved for potential tax liabilities, future financial results may include unfavorable adjustments to the Company’s tax liabilities, which could have a material adverse effect on the Company’s results of operations.
Fluctuations in foreign currency can have an adverse impact on our sales and profits as amounts that are measured in foreign currency are translated back to U.S. dollars. We have sales of inventory denominated in U.S. dollars to certain of our subsidiaries that have functional currencies other than the U.S. dollar.
Fluctuations in foreign currency can have an adverse impact on our sales and profits as amounts that are measured in foreign currency are translated to U.S. dollars. We have sales of inventory denominated in U.S. dollars to certain of our subsidiaries that have functional currencies other than the U.S. dollar.
We also establish additional reserves based upon our 20 perception of the quality of the current receivables, the current financial position of our customers, past collections experience, and existing and future market conditions. Prolonged or more severe economic weakness may result in additional requirements for reserves.
We also establish additional reserves based upon our perception of the quality of the current receivables, the current financial position of our customers, past collections experience, and existing and future market conditions. Prolonged or more severe economic weakness may result in additional requirements for reserves.
However, the potential consequences of a future material cybersecurity attack may include reputational damage, litigation with third-parties, government enforcement actions, penalties, disruption to our systems or operations of our facilities, unauthorized release of confidential or otherwise protected information, corruption of data, diminution in the value of our investment in research, development and engineering, increased cybersecurity protection costs and unplanned remediation costs, which in turn could adversely affect our competitiveness, results of operations and financial condition.
However, the potential consequences of a future material cybersecurity attack may include reputational damage, litigation with third parties, government enforcement actions, penalties, disruption to our systems or operations of our facilities, unauthorized release of confidential or otherwise protected information, corruption of data, diminution in the value of our investment in research, development and engineering, increased cybersecurity protection costs and unplanned investigation, remediation and other costs, which in turn could adversely affect our competitiveness, results of operations and financial condition.
In addition, our entry into certain markets that we wish to enter may require us to establish a joint venture or face competition from national state-backed competitors. Identifying an appropriate joint venture partner and creating a joint venture could be more time consuming, more costly and more difficult than we anticipate.
In addition, our entry into certain markets that we wish to enter may require us to establish a joint venture or face competition from foreign state-backed competitors. Identifying an appropriate joint venture partner and creating a joint venture could be more time consuming, more costly and more difficult than we anticipate.
This accounting requires judgment relative to assessing risks, estimating revenues and costs and making assumptions regarding the timing of receipt of delivery orders from our government customer and technical issues. Due to the size and nature of these contracts, the estimate of costs is complicated and subject to many variables.
This accounting requires judgment relative to assessing risks, estimating revenues and costs and making assumptions regarding the timing of receipt of delivery orders from our government customers and technical issues. Due to the size and nature of these contracts, the estimate of costs is complicated and subject to many variables.
Our results could be adversely affected by severe weather, natural disasters, and other events in the locations in which we or our customers or suppliers operate. We have manufacturing and other operations in locations prone to severe weather and natural disasters, including tornados, earthquakes, floods, hurricanes or tsunamis that could disrupt our operations.
Our results could be adversely affected by severe weather, natural disasters, and other events in the locations in which we or our customers or suppliers operate. We have manufacturing and other operations in locations prone to severe weather and natural disasters, including tornados, earthquakes, floods, fires, hurricanes, tsunamis or severe snowstorms, that could disrupt our operations.
Delays in obtaining parts, materials, components and final assemblies may result from a number of factors affecting our suppliers including capacity constraints, labor constraints, supplier product quality issues, suppliers’ impaired financial condition and suppliers’ allocations to other purchasers.
Delays in obtaining parts, materials, components and final assemblies may result from a number of factors affecting our suppliers including shipping disruptions, capacity constraints, labor constraints, supplier product quality issues, suppliers’ impaired financial condition and suppliers’ allocations to other purchasers.
In addition, certain tax policy efforts, including any tax law changes resulting from the Organization for Economic Cooperation and Development (OECD) and the G20's inclusive framework on Base Erosion and Profit Sharing (BEPS), could adversely impact our tax rate and subsequent tax expense.
In addition, certain tax policy efforts, including any tax law changes resulting from the Organization for Economic Cooperation and Development and the G20's inclusive framework on Base Erosion and Profit Sharing, could adversely impact our tax rate and subsequent tax expense.
In years when the U.S. government has not completed its budget process before the end of its fiscal year, which is currently the case for the U.S. government's fiscal 2024 budget, government operations are typically funded pursuant to a “continuing resolution,” which allows federal government agencies to operate at spending levels approved in the previous budget cycle but does not authorize new spending initiatives.
In years when the U.S. government has not completed its budget process before the end of its fiscal year, which is currently the case for the U.S. government's fiscal 2025 budget, government operations are typically funded 16 pursuant to a “continuing resolution,” which allows federal government agencies to operate at spending levels approved in the previous budget cycle but does not authorize new spending initiatives.
International operations and sales are subject to various risks, including political, religious and economic instability, local labor market conditions, the imposition of foreign tariffs upon our products (which include tariffs in response to tariffs that the U.S. imposes) and other trade barriers, the impact of foreign government regulations and the effects of income and withholding taxes, sporadic order patterns, governmental expropriation, uncertainties or delays in collection of accounts receivable and differences in business practices.
International operations and sales are subject to various risks, including political, religious and economic instability, the imposition of foreign tariffs upon our products (which include tariffs in response to tariffs that the U.S. imposes) and other trade barriers, the impact of foreign government regulations and the effects of income and withholding taxes, sporadic order patterns, governmental expropriation, uncertainties or delays in collection of accounts receivable and differences in business practices.
We attempt to limit the risk related to raw material price fluctuations on prices for major defense components by obtaining firm pricing from suppliers at the time a contract is awarded. However, if these suppliers do not honor their contracts, then we could face margin pressure.
We attempt to limit the risk related to raw material price fluctuations for major defense components by obtaining firm pricing from suppliers at the time a contract is awarded. However, if these suppliers do not honor their contracts, then we could face profit margin pressure.
During periods of economic weakness, the collateral underlying our guarantees of indebtedness of customers or receivables can decline sharply, thereby increasing our exposure to losses. We also face a concentration of credit risk as the Access segment’s ten largest debtors at December 31, 2023 represented approximately 29% of our consolidated gross receivables. Some of these customers are highly leveraged.
During periods of economic weakness, the collateral underlying our guarantees of indebtedness of customers or receivables can decline sharply, thereby increasing our exposure to losses. We also face a concentration of credit risk as the Access segment’s ten largest debtors at December 31, 2024 represented approximately 22% of our consolidated gross receivables. Some of these customers are highly leveraged.
We cannot provide any assurance we will be able to successfully achieve the benefits of any business acquisition due to a variety of risks, including the following: • Our ability to identify acquisition targets and consummate transactions; 18 • Our failure to achieve the acquisition’s expected future financial performance or realize assumed efficiencies or assumed cost reductions; • There may be a cultural mismatch that exists between us and the acquired business; • We may experience delays or unexpected difficulties in integrating the acquired business; • We may incur unforeseen expenses or liabilities or may be subject to other unanticipated regulatory or government actions related to the acquired business; and • We may incur higher transaction costs than expected.
We cannot provide any assurance we will be able to successfully achieve the benefits of any business acquisition due to a variety of risks, including the following: • Our ability to identify acquisition targets and consummate transactions; • Our failure to achieve the acquisition’s expected future financial performance or realize assumed efficiencies or assumed cost reductions; • There may be a mismatch in workplace cultures between us and the acquired business; • We may experience delays or unexpected difficulties in integrating the acquired business; • We may incur unforeseen expenses or liabilities or may be subject to other unanticipated regulatory or government actions related to the acquired business; and • We may incur higher transaction costs than expected.
An impairment in the carrying value of goodwill and other indefinite-lived intangible assets could negatively affect our operating results. We have a substantial amount of goodwill and other indefinite-lived intangible assets on our balance sheet as a result of acquisitions we have completed. At December 31, 2023, approximately 75% of these intangibles were concentrated in the Access segment.
An impairment in the carrying value of goodwill and other indefinite-lived intangible assets could negatively affect our operating results. We have a substantial amount of goodwill and other indefinite-lived intangible assets on our balance sheet as a result of acquisitions we have completed. At December 31, 2024, approximately 77% of these intangibles were concentrated in the Access segment.
The access equipment market is highly cyclical and impacted (i) by the strength of economies in general and customers’ perceptions concerning the timing of economic cycles, (ii) by residential and non-residential construction spending, including mega projects, (iii) by the ability of rental companies to obtain third-party financing to purchase revenue generating assets, (iv) by capital expenditures of rental companies in general, including the rate at which they replace aged rental equipment, which is impacted in part by historical purchase levels, (v) by the timing of regulatory standard changes, and (vi) by other factors, including oil and gas related activity.
The access equipment market is highly cyclical and impacted (i) by the strength of economies in general and customers’ perceptions concerning the timing of economic cycles, (ii) by residential and non-residential construction spending, (iii) by the ability of rental companies to obtain third-party financing to purchase revenue generating assets, (iv) by capital expenditures of rental companies in general, including the rate at which they replace aged rental equipment, (v) by the timing of regulatory standard changes, and (vi) by other factors, including oil and gas related activity and government spending.
Any violations of the FCPA could result in significant fines, criminal sanctions against us or our employees, and prohibitions on the conduct of our business, including our business with the U.S. government. We are also increasingly subject to export control regulations, including, without limitation, the United States Export Administration Regulations and the International Traffic in Arms Regulations.
Any violations of the FCPA could result in significant fines, criminal sanctions against us or our employees, and prohibitions on the conduct of our business, including our business with the U.S. government. We are also increasingly subject to export control regulations, including, but not limited to, the United States Export Administration Regulations and the International Traffic in Arms Regulations.
Labor issues may adversely impact our results. Our production, or the production of our suppliers, could be disrupted by labor issues including availability of skilled workforce in locations in which we and our suppliers operate due to competition, absenteeism, public health issues, strikes or other factors.
Our production, or the production of our suppliers, could be disrupted by labor issues including availability of skilled workforce in locations in which we and our suppliers operate due to competition, absenteeism, public health issues, strikes or other factors.
We have experienced cyber security threats and vulnerabilities in our systems and those of our third-party providers, and we have experienced viruses and attacks targeting our information technology systems and networks. Such prior events, to date, have not had a material impact on our financial condition, results of operations or liquidity.
We have experienced cybersecurity threats and vulnerabilities in our systems and those of our third-party providers, and we have experienced viruses and attacks targeting our information technology systems and networks. Such prior events have not had a material impact on our financial condition, results of operations or liquidity.
If we fail to have adequate relationships with suppliers that will supply appropriate engines, chassis, batteries and other power sources to us or fail to timely receive appropriate components from our suppliers, that could result in us being placed in an uncompetitive position or without finished product when needed.
If we fail to have adequate relationships with suppliers that will supply appropriate engines, chassis, batteries and other power sources to us or fail to timely receive appropriate components from our suppliers, that could result in us being placed in an uncompetitive position or without finished product when needed. Labor issues may adversely impact our results.
Competition for DoD programs that we currently have has resulted and could in the future result in the U.S. government awarding future contracts to another manufacturer or could result in the U.S. government awarding the contracts to us at lower prices and operating margins than we experience under the current contracts.
Department of Defense (DoD) programs that we currently have has resulted and could in the future result in the U.S. government awarding future contracts to another manufacturer or could result in the U.S. government awarding the contracts to us at lower prices and operating margins than we experience under the current contracts.
Fire apparatus markets are cyclical later in an economic cycle and are impacted by the economy generally and by municipal tax receipts and capital expenditures.
Municipal fire apparatus markets are cyclical later in an economic cycle and are impacted by the economy generally and by municipal tax 13 receipts.
Such disruptions have resulted and could further result in higher manufacturing costs caused by an inefficient parts flow to our production lines, could delay sales and could result in a material adverse effect on our results of operations, financial condition, and/or cash flows.
Such disruptions have resulted and could further result in higher manufacturing costs caused by an inefficient parts flow to our production lines or the need to procure parts from higher cost suppliers, could delay sales and could result in a material adverse effect on our results of operations, financial condition, and/or cash flows.
Approximately 17% of our net sales in 2023 were attributable to products sold outside of the United States, of which approximately 46% involved export sales from the United States. The majority of export sales are denominated in U.S. dollars. Sales that originate outside the United States are typically transacted in the local currencies of those countries.
Approximately 14% of our net sales in 2024 were attributable to products sold outside of the United States, of which approximately 40% involved export sales from the United States. The majority of export sales are denominated in U.S. dollars. Sales that originate outside the United States are typically transacted in the local currencies of those countries.
The indentures governing our senior notes also contain restrictive covenants. Any failure by us to comply with these restrictive covenants or the financial and restrictive covenants in our credit agreement could have a material adverse effect on our financial condition, results of operations and debt service capability.
Any failure by us to comply with these restrictive covenants or the financial and restrictive covenants in our credit agreement could have a material adverse effect on our financial condition, results of operations and debt service capability.
In addition, the cost of parts, materials, components or final assemblies has increased and may continue to increase for reasons other than changes in commodity prices, including the inflation that we continue to experience.
In addition, the cost of parts, materials, components or final assemblies has increased and may continue to increase for reasons other than changes in commodity prices.
A majority of our contracts in the Defense segment are large in size and require significant personnel and production resources, and when our government customers allow such contracts to expire or significantly reduce their vehicle requirements under such contracts, we must make adjustments to personnel and production resources.
A majority of our contracts in the Defense segment are large in size and require significant personnel and production resources, and when our government customers allow such contracts to expire or significantly reduce their vehicle requirements under such contracts, we must make adjustments to personnel and production resources. Production on the domestic JLTV contract is expected to conclude early 2025.
Refuse collection vehicle markets are also cyclical and impacted by the strength of economies in general, by municipal tax receipts and by the size and timing of capital expenditures, including replacement demand, by large waste haulers.
Refuse and recycling collection vehicle markets are also cyclical and impacted by the strength of economies in general, by municipal tax receipts and by the size and timing of capital expenditures, including replacement demand, by large waste haulers. Airport products markets are also cyclical and impacted by global demand for air transportation services.
We may incur increased costs, including increased supply chain costs, and experience delays or disruptions in production schedules, product deliveries or payments in connection with international manufacturing and sales that could cause loss of revenues and earnings.
Changes in international trade policies could result in changes to our international operations and/or international growth strategy. We may incur increased costs, including increased supply chain costs, and experience delays or disruptions in production schedules, product deliveries or payments in connection with international manufacturing and sales that could cause loss of revenues and earnings.
Disruptions within our dealer network could adversely affect our business. Although we sell the majority of our products directly to the end user, we market, sell and service products through a network of independent dealers in the Vocational segment and in a limited number of markets for the Access segment.
Although we sell the majority of our products directly to the end user, we market, sell and service products through a network of independent dealers in the Vocational segment and in a limited number of markets in the Access segment.
While we spent $134 million, $113 million and $103 million for research and development in 2023, 2022 and fiscal 2021, respectively, we cannot provide any assurance that this level of investment in research and development will be sufficient to maintain our competitive strength in product innovation, which could cause our business to suffer.
While we spent $169 million for research and development in 2024, we cannot provide any assurance that this level of investment in research and development will be sufficient to maintain our competitive strength in product innovation, which could cause our business to suffer.
If demand for our products is lower than what we or the market expect, due to a recession or other factors, then there could be an adverse effect on our net sales, financial condition, profitability and/or cash flows. Our performance under the USPS contract may not be what we expect.
If demand for our products is lower than what we or the market expect, due to a recession or other factors, then there could be an adverse effect on our net sales, financial condition, profitability and/or cash flows. In addition, those impacts could be more than we anticipate.
For instance, cumulative catch-up adjustments on contracts in the Defense segment negatively impacted operating income by $44.9 million in 2022, primarily as a result of higher anticipated material costs. Furthermore, under the revenue recognition accounting rules, we can only include units in our estimates of overall contract profitability after we have received a firm delivery order for those units.
For example, cumulative catch-up adjustments on contracts in the Defense segment negatively impacted operating income by $47 million in 2024. Furthermore, under the revenue recognition accounting rules, we can only include units in our estimates of overall contract profitability after we have received a firm delivery order for those units.
The current continuing resolution funding the U.S. government expires on March 1, 2024 or March 8, 2024, depending on the group of the U.S. government in which the department falls. Furthermore, in years when the U.S. government fails to complete its budget process or to provide for a continuing resolution, a federal government shutdown may result.
The current continuing resolution funding the U.S. government expires on March 14, 2025. Furthermore, in years when the U.S. government fails to complete its budget process or to provide for a continuing resolution, a federal government shutdown may result.
Costs for these items may remain elevated or continue to increase in the future due to one or more of the following, among others: a sustained economic recovery; the level of tariffs that the U.S. imposes on imported steel and aluminum; the outbreak of conflicts in regions of the world that produce the commodities, the raw materials that go into the commodities or through which the commodities are transported; or a weakening U.S. dollar.
Costs for these items may increase in the future due to a variety of factors, including: the level of tariffs that the U.S. imposes on imported steel, aluminum and other commodities; an outbreak of conflicts in regions of the world that produce the commodities or the raw materials that go into the commodities or through which the commodities are transported; or a weakening U.S. dollar.
However, disruption of dealer coverage within a specific state or other geographic market could cause difficulties in marketing, selling or servicing our products and have an adverse effect on our net sales, financial condition, results of operations and/or cash flows.
However, disruption of dealer coverage within a specific state or other geographic market could cause difficulties in marketing, selling or servicing our products and have an adverse effect on our net sales, financial condition, results of operations and/or cash flows. In 2024, we transitioned our non-fleet refuse and recycling collection vehicle business from factory direct sales to a dealer network.
If we are unable to replace the Caterpillar-branded revenue through sales or our telehanders, including our new agricultural telehandlers, the expiration of the Caterpillar license could have a material adverse effect on our net sales, financial condition, results of operations and/or cash flows. We may not realize all of the anticipated benefits of our acquisitions.
Caterpillar-branded telehandlers accounted for $315 million in sales in 2024. If we are unable to replace the Caterpillar-branded revenue through sales of our other telehandlers, including our new agricultural telehandlers, then the expiration of the Caterpillar license could have a material adverse effect on our net sales, financial condition, results of operations and/or cash flows.
Fluctuations in prices of raw materials and other inputs may adversely impact our results. We purchase, directly and indirectly through component purchases, significant amounts of steel, aluminum and other commodities. Steel, aluminum and other commodity prices have historically been highly volatile.
We purchase, directly and indirectly through component purchases, significant amounts of steel, aluminum and other commodities. Steel, aluminum and other commodity prices have historically been highly volatile.
We cannot provide any assurance that our products will continue to compete effectively with the products of competitors or that we will be able to retain our customer base or improve or maintain our profit margins on sales to our customers.
We cannot provide any assurance that our products will continue to compete effectively with the products of competitors or that we will be able to retain our customer base or improve or maintain our profit margins on sales to our customers. Our long-term license agreement with Caterpillar Inc. to produce Caterpillar branded telehandlers ended in the fourth quarter of 2024.
Our credit agreement contains financial and restrictive covenants which, among other things, require us to maintain a leverage ratio. Our ability to meet the leverage ratio may be affected by a number of risks or events, including the risks described in this Annual Report on Form 10-K and events beyond our control.
Our ability to meet the leverage ratio may be affected by a number of risks or events, including the risks described in this Annual Report on Form 10-K and events beyond our control. The indentures governing our senior notes also contain restrictive covenants.
If we are not able to recover cost increases through surcharges or permanent price increases to our customers, then such increases will have an adverse effect on our financial condition, profitability and/or cash flows. Furthermore, surcharges or permanent price increases may not be accepted by our customers, resulting in them choosing to order from our competitors instead of us.
Furthermore, price increases may not be accepted by our customers, resulting in them choosing to order from our competitors instead of us. Any significant decrease in orders could have an adverse effect on our net sales, financial condition, profitability and/or cash flows.
If that trend in customer and dealer consolidation continues, it could have an unfavorable impact on our pricing and product margins. Competition and Strategy Risks We face significant competition in the markets we serve. The markets in which we operate are highly competitive. We compete worldwide with a number of other manufacturers that produce and sell similar products.
Competition and Strategy Risks We face significant competition in the markets we serve. The markets in which we operate are highly competitive. We compete worldwide with a number of other manufacturers that produce and sell similar products.
For example, the Access segment’s largest customers are rental companies that serve the end user equipment rental markets. Should larger access equipment customers continue to grow through the acquisition of smaller rental companies, their buying influence may grow and may impact the competitive environment within the industry.
Should access equipment customers consolidate through mergers and acquisitions, or should larger access equipment customers continue to grow through the acquisition of smaller rental companies, the buying influence of access equipment customers may grow and may impact the competitive environment within the industry.
Such changes may reduce revenues that we expect in our Defense segment, especially in light of federal budget pressures, lower levels of U.S. ground troops deployed in foreign conflicts and the level of defense funding that will be allocated to the DoD’s tactical wheeled vehicle strategy generally. • The U.S. government may not budget for or appropriate funding that we expect for our U.S. government contracts, which may prevent us from realizing revenues under current contracts or receiving additional orders that we anticipate we will receive.
Such changes may reduce revenues that we expect in our Defense segment, especially in light of federal budget pressures, lower levels of U.S. ground troops deployed in foreign conflicts and the level of defense funding that will be allocated to the DoD’s tactical wheeled vehicle strategy generally. • Certain of our U.S. government contracts could be delayed or terminated, and all such contracts expire in the future and may not be replaced, which could reduce revenues that we expect under the contracts and negatively affect margins in our Defense segment. • The funding of DoD programs is subject to an annual congressional budget authorization and appropriations process.
We are continuously evaluating potential acquisitions to support our business strategy. For example, in August 2023, we completed our acquisition of AeroTech from JBT Corporation. As part of this evaluation process, we perform due diligence to identify potential risks associated with the potential transaction. We also make assumptions regarding future performance of the acquired business.
As part of this evaluation process, we perform due diligence to identify potential risks associated with the potential transaction. 18 We also make assumptions regarding future performance of the acquired business.
We have experienced, and in the future are likely to experience, significant disruption of the supply of some of our parts, materials, components and final assemblies that we obtain from suppliers or subcontractors. For example, global supply chains have not yet fully returned to pre-pandemic levels.
We are dependent upon third-party suppliers, making us vulnerable to supply shortages and price increases. We have experienced, and in the future are likely to experience, significant disruption of the supply of some of our parts, materials, components and final assemblies that we obtain from suppliers or subcontractors.
As an example, in February 2023, the DoD awarded the JLTV Family of Vehicles follow on contract to another company based on, at least in part, a lower price. • Competitions for U.S. government contracts are intense, and we cannot provide any assurance that we will be successful in current or future procurement competitions in which we participate, as evidenced by the award of the JLTV follow on contract to another company.
In addition, although we believe there is demand from international customers for our tactical wheeled vehicles, there is no assurance that additional orders will materialize. • Competitions for U.S. government contracts are intense, and we cannot provide any assurance that we will be successful in current or future procurement competitions in which we participate, as evidenced by the award of the JLTV follow on contract to another company.
We are dependent on U.S. and foreign government contracts for a substantial portion of our business. Approximately 19% of our net sales in 2023 were to the U.S. government.
Our dependency on contracts with U.S. and foreign government agencies subjects us to a variety of risks that could materially reduce our revenues or profits. 15 We are dependent on U.S. and foreign government contracts for a substantial portion of our business. Approximately 20% of our net sales in 2024 were to the U.S. government.
An increase in general interest rates, as has occurred during 2023, would also increase our cost of borrowing under our credit agreement. Additional liabilities relating to changes in tax rates or exposure to additional income tax liabilities could adversely impact our financial condition and cash flow. We are subject to income taxes in the U.S. and various non-U.S. jurisdictions.
Additional liabilities relating to changes in tax rates or exposure to additional income tax liabilities could adversely impact our financial condition and cash flow. We are subject to income taxes in the U.S. and various non-U.S. jurisdictions. Our domestic and international tax liabilities are dependent upon the location of earnings among these different jurisdictions.
We may be required to make material expenditures or incur additional liabilities to comply with changes in environmental laws or climate change regulations or to meet the increasing societal expectations on companies to address climate change. Both our products and the operation of our manufacturing facilities are subject to statutory and regulatory requirements.
Unfavorable changes in the political, regulatory or business climate could have a material adverse effect on our net sales, financial condition, profitability and/or cash flows. 22 We may be required to make material expenditures or incur additional liabilities to comply with changes in environmental laws or climate change regulations or to meet the increasing societal expectations on companies to address climate change.
Because new orders have the potential to significantly change the overall profitability of cumulative orders received to date, particularly early in the contract when fewer overall units are on order, the period in which we receive those orders from the government will impact the estimated life-to-date contract profitability.
Because new orders have the potential to significantly change the overall profitability of cumulative orders received to date, the period in which we receive those orders from the government will impact the estimated life-to-date contract profitability. Changes in underlying assumptions, circumstances or estimates could have a material adverse effect on our net sales, financial condition and/or profitability.
While we continue to develop and offer more propulsion choices in our products, such as electric-powered vehicles or mobile equipment with lower emissions, this will continue to require us to spend additional funds on product research and development and implementation costs and subject us to the risk that our competitors may respond to these pressures in a manner that gives them a competitive advantage.
Continued development of enhanced propulsion choices will require us to spend additional funds on research and development and subject us to the risk that our competitors may respond to these pressures in a manner that gives them a competitive advantage.
The legislation of greenhouse gases could result in unfavorable financial impacts through various forms including taxation, emission allowances, fines, requirements for facilities improvement investment and higher energy costs. The impact of any future greenhouse gas legislation, regulatory, or product standard requirements is unknown, and therefore, we are uncertain of the potential impact that future changes may have.
The impact of any future greenhouse gas legislation, regulatory, or product standard requirements is unknown, and therefore, we are uncertain of the potential impact that future changes may have.
In addition, we were subject to obligations to guarantee customer indebtedness to third parties of $668.5 million, under which we estimate our maximum exposure to be $104.9 million. We evaluate the collectability of receivables and our guarantees of indebtedness of others based on a combination of factors and establish reserves based on our estimates of potential current and future losses.
We evaluate the collectability of receivables and our guarantees of indebtedness of others based on a combination of factors and establish reserves based on our estimates of potential current and future losses.
Climate change attributed to increased levels of greenhouse gases, including carbon dioxide, has led to significant legislative, regulatory, investment community and societal efforts to limit greenhouse gas emissions. These considerations may lead to new international, national, regional, or local legislation or regulatory responses.
A significant change to these regulatory requirements could substantially increase manufacturing costs, which could make our business results more variable. Climate change attributed to increased levels of greenhouse gases, including carbon dioxide, has led to significant legislative, regulatory, investment community and societal efforts to limit greenhouse gas emissions.
As of December 31, 2023, we have recorded deferred contract costs of $710.7 million that primarily relate to the NGDV program.
As of December 31, 2024, we have recorded an asset for deferred contract costs of $842.6 million that primarily relates to the NGDV program. Contract costs are amortized over the anticipated production volume of the related contract.
These include environmental requirements applicable to manufacturing and vehicle emissions, government contracting regulations, regulations impacting our supply chain and domestic and international trade regulations. A significant change to 22 these regulatory requirements could substantially increase manufacturing costs, which could make our business results more variable.
Both our products and the operation of our manufacturing facilities are subject to statutory and regulatory requirements. These include environmental requirements applicable to manufacturing and vehicle emissions, government contracting regulations, regulations impacting our supply chain and domestic and international trade regulations.
If sufficient workforce is not available or rates are higher than we anticipate, it could have an adverse effect on our net sales, financial condition, profitability and/or cash flows. 15 Our dependency on contracts with U.S. and foreign government agencies subjects us to a variety of risks that could materially reduce our revenues or profits.
In addition, our production schedules assume the availability of sufficient workforce in areas in which our facilities operate at anticipated labor rates. If sufficient workforce is not available or rates are higher than we anticipate, it could have an adverse effect on our net sales, financial condition, profitability and/or cash flows.
The USPS contract and our performance under the contract are subject to the following risks, among others, that could have a material adverse effect on our results of operations, financial condition, and/or cash flows: • The USPS ordering fewer units than we expect to receive under the contract. • Engineering time to finalize the production vehicle design may be greater than we anticipate. • Tooling and factory build-out activities that we must complete prior to production may be greater than we anticipate. • Costs and other challenges associated with recruiting and training a new workforce may be greater than we anticipate. • The supply base may not be able to supply parts in a timely manner. 14 We are dependent upon third-party suppliers, making us vulnerable to supply shortages and price increases.
The USPS contract and our performance under the contract are subject to the following risks, among others, that could have a material adverse effect on our results of operations, financial condition, and/or cash flows: • The USPS ordering fewer units than we expect which could result in an impairment of our deferred contract asset. • It may take longer or cost more than we anticipate to scale our production to full rate production, which may result from additional costs, product design changes, supplier product quality issues or delays in receiving products from suppliers, costs and other challenges associated with recruiting and training a new workforce or other challenges associated with scaling production. • Our supply base may not be able to supply parts in a timely manner. • Warranty costs may be higher than we anticipate. • If additional orders are received, the mix of internal combustion engine and battery electric vehicles could be different from our expectations, which could reduce revenues that we expect under the contract and negatively affect anticipated margins. • The USPS may exercise its right to terminate the contract for convenience.
In February 2021, the USPS selected us to build its NGDV. The IDIQ contract allows for the purchase of up to 165,000 units over 10 years. To date, we have received orders for the engineering to finalize the production vehicle design, for tooling and factory build-out activities that are necessary prior to vehicle production and for the first 50,000 vehicles.
Our performance under the United States Postal Service (USPS) contract may not be what we expect. In 2021, the USPS selected us to build its Next Generation Delivery Vehicle (NGDV). The indefinite delivery, indefinite quantity (IDIQ) contract allows for the purchase of up to 165,000 units over 10 years. Through December 31, 2024, we have received orders for 51,500 vehicles.
Increases in parts, materials, components or final assemblies costs negatively impact the profitability of orders in backlog as prices on a portion of those orders are fixed.
Increases in parts, materials, components or final assemblies costs negatively impact the profitability of orders in backlog as prices on those orders are generally less flexible. If we are not able to recover cost increases through price increases to our customers, then such increases will have an adverse effect on our financial condition, profitability and/or cash flows.
Changes in underlying assumptions, circumstances or estimates could have a material adverse effect on our net sales, financial condition and/or profitability. We may experience losses in excess of our recorded reserves for doubtful accounts and guarantees of indebtedness of others. As of December 31, 2023, we had consolidated gross receivables of $1.3 billion.
We may experience losses in excess of our recorded reserves for doubtful accounts and guarantees of indebtedness of others. As of December 31, 2024, we had consolidated gross receivables of $1.3 billion. In addition, we were subject to obligations to guarantee customer indebtedness to third parties of $596 million, under which we estimate our maximum exposure to be $96 million.
These laws and regulations affect how we do business with our customers and, in many instances, impose added costs on our business. • Our Defense segment results may fluctuate significantly from time to time as a result of the start and completion of existing and new domestic and international contract awards that we may receive.
Furthermore, if our actual costs on any of these contracts exceed our projected costs, it could result in profits lower than historically realized or than we anticipate. • We must spend significant sums on product development and testing, bid and proposal activities, and pre-contract engineering, tooling and design activities in competitions to have the opportunity to be awarded these contracts. • Our Defense segment results may fluctuate significantly from time to time as a result of the start and completion of existing and new domestic and international contract awards that we may receive.
Removed
Air transportation equipment markets are also cyclical and impacted by the rates of expansion, consolidation and replacement of equipment within the air transportation equipment markets which in turn are driven by the global demand for air transportation services.
Added
Changes in trade policies and other factors beyond our control may adversely impact our results. In 2024, we directly imported from Mexico, China and Canada approximately $600 million, $175 million and $100 million, respectively.
Removed
In addition, conflicts in various parts of the world, including Ukraine, Israel and the Middle East have caused strains in the global supply chain and may do so in the future.
Added
Geopolitical tensions and trade disputes can disrupt supply chains and increase the cost of our products, which could cause our products to be more expensive for customers.
Removed
Any significant decrease in orders could have an adverse effect on our net sales, financial condition, profitability and/or cash flows.
Added
Countries could adopt restrictive trade measures such as tariffs, taxation, foreign exchange controls, capital controls and controls on imports or exports of goods, technology or data, any of which could adversely affect our operations and supply chain or limit our ability to offer our products and services as intended.
Removed
In addition, our production schedules assume the availability of sufficient workforce in areas in which our facilities operate at anticipated labor rates.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

9 edited+0 added−0 removed7 unchanged
Biggest changeThe CISO, who reports to the Company’s Chief Information Officer (CIO), has a Bachelor degree in Information Systems and MBA and is a Certified Information Systems Security Professional with over a decade of professional cybersecurity experience. The program aligned industry frameworks and controls from the National Institute of Standards and Technology.
Biggest changeThe CISO, who reports to the Company’s Chief Information Officer (CIO) , has a Bachelor's degree in Information Systems and Master of Business Administration degree and is a Certified Information Systems Security Professional with over a decade of professional cybersecurity experience.
This risk assessment process assesses both the service provider's security posture as well as the security controls available from the third-party information system. The service provider’s security posture assessment includes reviewing any third-party party attestations as well as third-party controls in the following areas: assets, data flows, authentication, access, monitoring, response, and recovery.
This risk assessment process assesses both the service provider's security posture as well as the security controls available from the third-party information system. The service provider’s security posture assessment includes reviewing any third-party attestations as well as third-party controls in the following areas: assets, data flows, authentication, access, monitoring, response and recovery.
The Audit Committee is also briefed on cyber crisis contingency planning and incident recovery capabilities and matters related to any material cybersecurity incident the company may experience.
The Audit Committee is also briefed on cyber crisis contingency planning, incident recovery capabilities and matters related to any material cybersecurity incident the company may experience.
The Board of Directors is responsible for general oversight of the Company's risk management program, including cybersecurity risks. The Board of Directors receives an annual report from senior management through the ORM program and material risk assessments and mitigation strategies, including with respect to cybersecurity risks.
Governance — The Board of Directors is responsible for general oversight of the Company's risk management program, including cybersecurity risks. The Board of Directors receives an annual report from senior management through the ORM program and material risk assessments and mitigation strategies, including with respect to cybersecurity risks.
See Item 1A under the caption "Increased cybersecurity threats and more sophisticated computer crime pose a risk to our systems, networks, operations, products and services." for additional information on cybersecurity risks applicable to the Company.
See Item 1A under the caption "Increased cybersecurity threats and more sophisticated computer crime pose a risk to our systems, networks, operations, products and services." for additional information on cybersecurity risks applicable to the Company. 24
ITEM 1C. CYBE RSECURITY The Company maintains a cybersecurity risk management program, led by a Chief Information Security Officer (CISO), that is responsible for the Company’s overall cybersecurity strategy, policy, architecture, and cyber threat detection and response.
ITEM 1C. CYBE RSECURITY Risk Management and Strategy — The Company maintains a cybersecurity risk management program, led by a Chief Information Security Officer (CISO), who is responsible for the Company’s overall cybersecurity strategy, policy, architecture and cyber threat detection and response.
Depending on the type of system or data, additional controls may be assessed. 23 The Incident Response Plan includes processes for detecting, containing, and responding to incidents including processes for reporting incidents to management and the Board of Directors. The Company periodically performs simulations and tabletop exercises at a management level and incorporates external advisors as needed.
Depending on the type of system or data, additional controls may be assessed. The Company maintains an Incident Response Plan that includes processes for detecting, containing, and responding to incidents including processes for reporting incidents to management and the Board of Directors. The Company periodically performs simulations and tabletop exercises at a management level and incorporates external advisors as needed.
The Company engages third-party services to conduct evaluations of its security controls, whether through penetration testing, independent audits or consulting on best practices to address cybersecurity risks. Assessing, identifying and managing cybersecurity related risks are integrated into the Company's overall Organization Risk Management (ORM) program.
The Company engages third-party service providers to conduct evaluations of its security controls, whether through penetration testing, independent audits or consulting on best practices to address cybersecurity risks. Assessing, identifying and managing cybersecurity-related risks is integrated into the Company's overall Organization Risk Management (ORM) program.
Leveraging these frameworks and controls allows the Company to identify the fundamental security capabilities and controls necessary to maintain and enhance the program. The Company utilizes a wide range of capabilities to maintain cybersecurity, including threat intelligence, multi-factor authentication, endpoint detection and response, and security automation.
The Company's program is aligned to industry frameworks and controls from the National Institute of Standards and Technology that allow the Company to identify the fundamental security capabilities and controls necessary to maintain and enhance the program. The Company utilizes a wide range of capabilities to maintain cybersecurity, including threat intelligence, multi-factor authentication, endpoint detection and response and security automation.

Item 2. Properties

Properties — owned and leased real estate

3 edited+0 added−2 removed1 unchanged
Biggest changeThe locations of the Company’s manufacturing facilities are provided in the table below: Segment Location (# of facilities) Segment Location (# of facilities) Access McConnellsburg, Pennsylvania (3) (a) Vocational Appleton, Wisconsin (2) Shippensburg, Pennsylvania (1) Bradenton, Florida (1) Greencastle, Pennsylvania (1) Kewaunee, Wisconsin (1) Tianjin, China (2) (c) Clearwater, Florida (1) (b) Tonneins, France (1) (b) Neenah, Wisconsin (1) (b) Port Macquarie, Australia (1) Saint-Georges, Quebec, Canada (1) Leicester, United Kingdom (1) Dodge Center, Minnesota (1) Bedford, Pennsylvania (1) Garner, Iowa (1) Leon, Mexico (1) Riceville, Iowa (1) Norgara, Italy (1) Murfreesboro, Tennessee (1) Jefferson City, Tennessee (1) (d) Orlando, Florida (1) Ogden, Utah (1) Defense Oshkosh, Wisconsin (4) Warrenton, Oregon (1) (b) Spartanburg, South Carolina (1) (b) Ciudad Juarez, Mexico (1) (b) (a) Two facilities are owned, and the other is leased.
Biggest change(# of facilities) Access McConnellsburg, Pennsylvania (3) (b) Tianjin, China (2) (c) Shippensburg, Pennsylvania (1) Leon, Mexico (1) Jefferson City, Tennessee (1) (a) Nogara, Italy (1) Greencastle, Pennsylvania (1) Manresa, Spain (1) Tonneins, France (1) (a) Vocational Appleton, Wisconsin (2) Saint-Georges, Quebec, Canada (1) Dodge Center, Minnesota (1) Ogden, Utah (1) Bradenton, Florida (1) Orlando, Florida (1) Garner, Iowa (1) Neenah, Wisconsin (1) (a) Kewaunee, Wisconsin (1) Clearwater, Florida (1) (a) Warrenton, Oregon (1) (a) Murfreesboro, Tennessee (1) (a) Riceville, Iowa (1) Defense Oshkosh, Wisconsin (4) Spartanburg, South Carolina (1) (a) (a) These facilities are leased.
(b) These facilities are leased. (c) One facility is owned, and the other is leased. (d) Facility also produces sub-components for Defense. 24 The Company’s manufacturing facilities generally operate five days per week on one or two shifts, except for seasonal shutdowns for one- to three-week periods.
(b) Two facilities are owned, and the other is leased. (c) One facility is owned, and the other is leased. The Company’s manufacturing facilities generally operate five days per week on one or two shifts, except for seasonal shutdowns for one- to three-week periods.
ITEM 2. PROPERTIES The Company believes its equipment and buildings are well maintained and adequate for its present and anticipated needs. As of December 31, 2023, the Company operated in 34 significant manufacturing facilities.
ITEM 2. PROPERTIES The Company believes its equipment and buildings are well maintained and adequate for its present and anticipated needs. As of December 31, 2024, the Company operated in 31 manufacturing facilities. The locations of the Company’s manufacturing facilities are provided in the table below: Segment U.S. Facilities (# of facilities) Facilities Outside the U.S.
Removed
In addition to sales and service activities at the Company’s manufacturing facilities, the Company maintains a network of sales and service centers in the U.S. The Company uses these facilities primarily for sales and service of refuse collection vehicles and front-discharge concrete mixers.
Removed
The Access segment also leases a number of small distribution, engineering, administration or service facilities throughout the world.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

2 edited+0 added−0 removed3 unchanged
Biggest changeAt December 31, 2023, the estimated net liabilities for product and general liability claims totaled $50.1 million.
Biggest changeAt December 31, 2024, the estimated net liabilities for product and general liability claims totaled $45.2 million.
Actual results could vary, among other things, due to the uncertainties involved in litigation.
Actual results could vary, among other things, due to the uncertainties involved in litigation. 25

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

17 edited+4 added−4 removed0 unchanged
Biggest changePrior to joining the Company, he spent seven years in private practice in the Washington, D.C. area. He was appointed to Executive Vice President, General Counsel and Secretary in 2016. He was appointed to his current position of Executive Vice President, Chief Legal Officer and Secretary in February 2023. Mr. Cortina is a director of Alliant Energy Corporation. Jayanthi Iyengar.
Biggest changeHe was appointed Executive Vice President, Chief Legal Officer and Secretary in February 2023. In November 2024, his role expanded to include that of Chief Administrative Officer where he leads the Company's human resources, safety and facilities teams. Mr. Cortina is a director of Alliant Energy Corporation. Matthew A. Field — Mr.
Ms. Iyengar joined the Company in January 2022 as Executive Vice President and Chief Technology and Strategic Sourcing Officer. Prior to joining the Company, she served as Chief Technology and Quality Officer - CNH Industrial N.V., a designer, manufacturer and marketer of agricultural machinery and construction equipment, from 2019 to January 2022. Prior to that, Ms.
Iyengar joined the Company in January 2022 as Executive Vice President and Chief Technology and Strategic Sourcing Officer. Prior to joining the Company, she served as Chief Technology and Quality Officer - CNH Industrial N.V., a designer, manufacturer and marketer of agricultural machinery and construction equipment, from 2019 to January 2022. Prior to that, Ms.
ITEM 4. MINE SA FETY DISCLOSURES Not applicable. INFORMATION ABOUT OUR EXECU TIVE OFFICERS The following table sets forth certain information, as of February 29, 2024, concerning the Company’s executive officers. All of the Company’s executive officers serve terms of one year and until their successors are elected and qualified. Name Age Title John C.
ITEM 4. MINE SA FETY DISCLOSURES Not applicable. INFORMATION ABOUT OUR EXECU TIVE OFFICERS The following table sets forth certain information, as of February 20, 2025, concerning the Company’s executive officers. All of the Company’s executive officers serve terms of one year and until their successors are elected and qualified. Name Age Title John C.
Pfeifer joined the Company in 2019 as Executive Vice President and Chief Operating Officer. In May 2020, Mr. Pfeifer assumed the position of President and Chief Operating Officer of the Company. He was promoted to his current position of President and Chief Executive Officer on April 2, 2021.
In May 2020, Mr. Pfeifer assumed the position of President and Chief Operating Officer of the Company. He was promoted to his current position of President and Chief Executive Officer on April 2, 2021.
Prior to joining the Company, he served as Senior Vice President and President - Mercury Marine, of Brunswick Corporation, a designer, manufacturer and marketer of marine engines and marine parts and accessories, from 2014 to 2019. Mr. Pfeifer is a director of The Manitowoc Company, Inc. 25 Ignacio A. Cortina. Mr.
Prior to joining the Company, he served as Senior Vice President and President - Mercury Marine, of Brunswick Corporation, a designer, manufacturer and marketer of marine engines and marine parts and accessories, from 2014 to 2019. Mr.
Cortina joined the Company in 2006 with the acquisition of JLG. He has held various roles of increasing responsibility, serving as the Company’s Vice President and Deputy General Counsel from 2011 to 2015 and Senior Vice President, General Counsel and Secretary from 2015 to 2016.
He has held various roles of increasing responsibility, serving as the Company’s Vice President and Deputy General Counsel from 2011 to 2015 and Senior Vice President, General Counsel and Secretary from 2015 to 2016. He was appointed to Executive Vice President, General Counsel and Secretary in 2016.
Narang is a director of MOOG Inc. Michael E. Pack. Mr. Pack joined the Company in 2006 as Senior Director of Financial Analysis and Controls and has served in various assignments in the Commercial, Access and Fire & Emergency segments, including Vice President Finance - Fire & Emergency from 2012 to 2020.
Pack joined the Company in 2006 as Senior Director of Financial Analysis and Controls and has served in various assignments in the Access and Vocational segments, including Vice President Finance - Fire & Emergency from 2012 to 2020 and as Executive Vice President and Chief Financial Officer from 2020 to 2024.
Khare joined the Company in April 2018 as Senior Vice President and Chief Information Officer. He previously served as the Executive Director - Digital Technology at United Technologies Corporation, a global technology products and services company that serves the building systems and aerospace industries, from 2015 to April 2018. Prior to that, Mr.
He previously served as the Executive Director - Digital Technology at United Technologies Corporation, a global technology products and services company that serves the building systems and aerospace industries, from 2015 to April 2018. 27 PART II
He served as Controller for the Defense segment from 2010 to 2015 and as Vice President Finance, Defense segment from 2015 until his appointment to his current position of Senior Vice President and President, Defense Segment in November 2022. Bryan K. Brandt. Mr. Brandt joined the Company in 2016 as Vice President, Global Branding and Communications.
He has served in various positions of increasing responsibility, including Controller for the Defense segment from 2010 to 2015 and as Vice President Finance, Defense segment from 2015 to 2022. He was appointed to his current position of Senior Vice President and President, Defense Segment in November 2022. Bryan K. Brandt — Mr.
Pfeifer 58 President and Chief Executive Officer Ignacio A. Cortina 52 Executive Vice President, Chief Legal Officer and Secretary Jayanthi Iyengar 62 Executive Vice President and Chief Technology and Strategic Sourcing Officer James W. Johnson 59 Executive Vice President and President, Vocational Segment Mahesh Narang 48 Executive Vice President and President, Access Segment Michael E.
Pfeifer 59 President and Chief Executive Officer Ignacio A. Cortina 53 Executive Vice President, Chief Legal and Administrative Officer Matthew A. Field 52 Executive Vice President and Chief Financial Officer Jayanthi Iyengar 63 Executive Vice President and Chief Technology and Strategic Sourcing Officer Mahesh Narang 49 Executive Vice President and President, Access Segment Michael E.
Prior to joining the Company, he spent more than twenty years with Bemis Company, Inc., a global supplier of flexible packaging, in numerous positions of increasing responsibility, most recently as Vice President of Marketing and Transformation for Bemis North America from 2014 to 2016. Anupam Khare. Mr.
(which was subsequently acquired by Amcor plc), a global supplier of flexible packaging, in numerous positions of increasing responsibility, most recently as Vice President of Marketing and Transformation for Bemis North America from 2014 to 2016. Anupam Khare — Mr. Khare joined the Company in April 2018 as Senior Vice President and Chief Information Officer.
Pack 49 Executive Vice President and Chief Financial Officer Timothy S. Bleck 49 Senior Vice President and President, Defense Segment Bryan K. Brandt 55 Senior Vice President and Chief Marketing Officer Anupam Khare 59 Senior Vice President and Chief Information Officer Emma M. McTague 50 Senior Vice President and Chief Human Resources Officer John C. Pfeifer. Mr.
Pack 50 Executive Vice President and President, Vocational Segment Timothy S. Bleck 50 Senior Vice President and President, Defense Segment Bryan K. Brandt 56 Senior Vice President and Chief Marketing Officer Anupam Khare 60 Senior Vice President and Chief Information Officer John C. Pfeifer — Mr. Pfeifer joined the Company in 2019 as Executive Vice President and Chief Operating Officer.
Iyengar served as Senior Vice President Chief Innovation & Technology Officer - Xylem Inc., a water technology provider, from 2015 to 2019. Prior to that, Ms. Iyengar served as Vice President, Aerospace Engineering & Technology Officer - Eaton Corporation, a multinational power management company, from 2012 to 2015. Ms. Iyengar is a director of Array Technologies, Inc. James W. Johnson.
Iyengar served as Senior Vice President and Chief Innovation & Technology Officer - Xylem Inc., a water technology provider, from 2015 to 2019. Ms. Iyengar is a director of Array Technologies, Inc. 26 Mahesh Narang — Mr. Narang joined the Company in November 2023 as Executive Vice President and President, Access Segment.
He was appointed to his current position of Executive Vice President and President, Vocational Segment in January 2023. Mahesh Narang. Mr. Narang previously served as Vice President - Cummins Inc., a designer, manufacturer, and distributor of a broad portfolio of power solutions, including as President - Components at Cummins Inc. from 2021 to October 2023.
Prior to joining the Company, he previously served as Vice President - Cummins Inc., a designer, manufacturer, and distributor of a broad portfolio of power solutions, including as President - Components at Cummins Inc. from 2021 to October 2023. In this role, he was responsible for the strategic direction and led all operational aspects of the company’s global Components business.
He was appointed to his current position of Executive Vice President and Chief Financial Officer in April 2020. Timothy S. Bleck. Mr. Bleck joined the Company in 2006 as Controller of the Commercial segment and served in that role to 2010.
He was appointed to his current position of Executive Vice President and President, Vocational Segment in June 2024. Mr. Pack is a director of Winnebago Industries, Inc. Timothy S. Bleck — Mr. Bleck joined the Company in 2006.
He was appointed to his current position of Senior Vice President and Chief Marketing Officer in September 2018.
Brandt joined the Company in 2016 as Vice President, Global Branding and Communications. He was appointed to his current position of Senior Vice President and Chief Marketing Officer in September 2018. Prior to joining the Company, he spent more than twenty years with Bemis Company, Inc.
In this role, he was responsible for the strategic direction and led all operational aspects of the company’s global Components business. Components manufactures and sells filtration products, aftertreatment systems, turbochargers, electronics, fuel systems, automated transmissions, axles, drivelines, brakes and suspension systems. Prior to that role, Mr.
Components manufactures and sells filtration products, aftertreatment systems, turbochargers, electronics, fuel systems, automated transmissions, axles, drivelines, brakes and suspension systems. Prior to that role, Mr. Narang held positions of increasing responsibility since joining Cummins in 2003, including as President - Cummins Emission Solutions from 2017- 2021.
Removed
Mr. Johnson joined the Company in 2007 as Director of Dealer Development for Pierce. He served as Senior Vice President of Sales and Marketing for Pierce from 2009 to 2010. He served as the Executive Vice President and President, Fire & Emergency Segment from 2010 to 2023.
Added
Pfeifer is a director of James Hardie Industries plc and the National Exchange Bank and Trust, and also serves on the board of trustees at Froedtert ThedaCare Health, Inc. Ignacio A. Cortina — Mr. Cortina joined the Company in 2006 with the acquisition of JLG.
Removed
Narang held positions of increasing responsibility since joining Cummins in 2003, including as President - Cummins Emission Solutions from 2017- 2021. Cummins Emission Solutions is a designer, integrator, manufacturer and distributor of exhaust aftermarket systems and components. He was appointed to his current position of Executive Vice President and President, Access Segment in November 2023. Mr.
Added
Field joined the Company in December 2024 as Executive Vice President and Chief Financial Officer. Prior to joining the Company, he served as the Chief Financial Officer of Joby Aviation, Inc, an aviation company developing electric vertical takeoff and landing aircraft, since March 2021. Prior to joining Joby Aviation, Mr.
Removed
Khare served in positions of increasing responsibility at Koch Industries, Inc., a manufacturer of a wide variety of products. Emma M. McTague . Ms. McTague joined the Company in 2015 as Vice President and Chief Human Resources Officer for the Access segment.
Added
Field worked at Ford Motor Company, an automobile manufacturer, for over 20 years. Most recently he served as Chief Financial Officer, North America of Ford from October 2018 through March 2021, Corporate General Auditor from January 2018 through October 2018, and Chief Financial Officer, Lincoln Motor Company from November 2014 through December 2017. Jayanthi Iyengar — Ms.
Removed
She was appointed to her current position of Senior Vice President and Chief Human Resources Officer in February 2021. Ms. McTague is a director of Zurn Elkay Water Solutions Corporation. 26 PART II
Added
Cummins Emission Solutions is a designer, integrator, manufacturer and distributor of exhaust aftermarket systems and components. Mr. Narang is a director of MOOG Inc. Michael E. Pack — Mr.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

6 edited+0 added−1 removed3 unchanged
Biggest changeThe total return assumes reinvestment of dividends and is adjusted for stock splits. The fiscal 2023 return listed in the charts below is based on closing prices per share on December 31, 2023.
Biggest changeThe total return assumes reinvestment of dividends and is adjusted for stock splits. The 2024 return listed in the charts below is based on closing prices per share on December 31, 2024. On that date, the closing price for the Company’s Common Stock was $95.07. * $100 invested on September 30, 2019 in stock or index, including reinvestment of dividends.
The Company has chosen to use the Standard & Poor’s MidCap 400 market index as the broad-based index and the companies currently in the Standard Industry Classification Code 371 Index (motor vehicles and equipment) (the SIC Code 371 Index) as a more specific comparison. 27 The comparisons assume that $100 was invested on September 30, 2018 in each of: the Company’s Common Stock, the Standard & Poor’s MidCap 400 market index and the SIC Code 371 Index.
The Company has chosen to use the Standard & Poor’s MidCap 400 market index as the broad-based index and the companies currently in the Standard Industry Classification Code 371 Index (motor vehicles and equipment) (the SIC Code 371 Index) as a more specific comparison. 28 The comparisons assume that $100 was invested on September 30, 2019 in each of: the Company’s Common Stock, the Standard & Poor’s MidCap 400 market index and the SIC Code 371 Index.
From time to time, the Company may enter into a Rule 10b5-1 trading plan for the purpose of repurchasing shares under this authorization. Common Stock Information The Company’s Common Stock is listed on the New York Stock Exchange (NYSE) under the symbol OSK. As of February 22, 2024, there were 1,939 holders of record of the Common Stock.
From time to time, the Company may enter into a Rule 10b5-1 trading plan for the purpose of repurchasing shares under this authorization. Common Stock Information The Company’s Common Stock is listed on the New York Stock Exchange (NYSE) under the symbol OSK. As of February 13, 2025, there were 1,850 holders of record of the Common Stock.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED ST OCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Common Stock Repurchases The following table sets forth information with respect to purchases of Common Stock made by the Company or on the Company’s behalf during the fourth quarter of fiscal 2023: Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1) Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs (1) October 1 - October 31 — $ — — 11,284,882 November 1 - November 30 — $ — — 11,284,882 December 1 - December 31 — $ — — 11,284,882 Total — — 11,284,882 (1) In May 2022, the Board of Directors approved a Common Stock repurchase authorization of 12,000,000 shares.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED ST OCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Common Stock Repurchases The following table sets forth information with respect to purchases of Common Stock made by the Company or on the Company’s behalf during the fourth quarter of 2024: Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1) Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs (1) October 1 - October 31 — $ — — 10,720,477 November 1 - November 30 — $ — — 10,720,477 December 1 - December 31 494,069 $ 101.20 494,069 10,226,408 Total 494,069 494,069 (1) In May 2022, the Board of Directors approved a Common Stock repurchase authorization of 12,000,000 shares.
At December 31, 2023, the Company had repurchased 715,118 shares under this authorization. As a result, the Company had 11,284,882 shares of Common Stock remaining available for repurchase under the repurchase authorization. The Company can use the current authorization at any time as there is no expiration date associated with the authorization.
At December 31, 2024, the Company had repurchased 1,773,592 shares under this authorization. As a result, the Company had 10,226,408 shares of Common Stock remaining available for repurchase under the repurchase authorization. The Company can use the current authorization at any time as there is no expiration date associated with the authorization.
September 30, December 31, 2019 2020 2021 2022 2023 Oshkosh Corporation $ 108.00 $ 106.36 $ 150.07 $ 131.75 $ 164.99 S&P MidCap 400 market index 97.51 95.40 137.07 128.70 149.86 SIC Code 371 Index 97.02 221.31 368.06 201.13 314.57 ITEM 6. RESE RVED 28
September 30, December 31, 2020 2021 2022 2023 2024 Oshkosh Corporation $ 98.48 $ 138.95 $ 121.99 $ 152.77 $ 136.22 S&P MidCap 400 market index 97.84 140.58 131.99 153.68 175.09 SIC Code 371 Index 227.98 374.28 200.11 312.46 438.39 ITEM 6. RESE RVED 29
Removed
On that date, the closing price for the Company’s Common Stock was $108.41. * $100 invested on September 30, 2018 in stock or index, including reinvestment of dividends.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

65 edited+54 added−83 removed9 unchanged
Biggest changeRESULTS OF OPERATIONS- FISCAL 2023 COMPARED WITH FISCAL 2022 CONSOLIDATED RESULTS The following table presents consolidated results (in millions): Year Ended December 31, 2023 2022 Change % Change Net sales $ 9,657.9 $ 8,282.0 $ 1,375.9 16.6 % Cost of sales 7,977.1 7,227.6 749.5 10.4 % Gross income 1,680.8 1,054.4 626.4 59.4 % % of sales 17.4 % 12.7 % 470 bps SG&A expenses 810.4 662.8 147.6 22.3 % Amortization 32.8 11.6 21.2 182.8 % Impairment charge — 7.7 (7.7 ) -100.0 % Operating income 837.6 372.3 465.3 125.0 % % of sales 8.7 % 4.5 % 420 bps The following table presents net sales by geographic region based on product shipment destination (in millions): Year Ended December 31, 2023 2022 Change % Change North America $ 8,216.8 $ 7,468.2 $ 748.6 10.0 % Europe, Africa and Middle East 948.6 455.2 493.4 108.4 % Rest of the world 492.5 358.6 133.9 37.3 % $ 9,657.9 $ 8,282.0 $ 1,375.9 16.6 % Consolidated net sales increased as a result of higher consolidated volume ($630 million), higher pricing in response to higher input costs ($401 million) and the inclusion of sales related to acquisitions ($365 million) .
Biggest changeRESULTS OF OPERATIONS- 2024 COMPARED WITH 2023 CONSOLIDATED RESULTS The following table presents consolidated results (in millions): Year Ended December 31, 2024 2023 Change % Change Net sales $ 10,730.2 $ 9,657.9 $ 1,072.3 11.1 % Cost of sales 8,760.8 7,977.1 783.7 9.8 % Gross income 1,969.4 1,680.8 288.6 17.2 % % of sales 18.4 % 17.4 % 100 bps Selling, general and administrative 852.4 810.4 42.0 5.2 % Amortization of purchased intangibles 54.7 32.8 21.9 66.8 % Intangible asset impairments 51.6 — 51.6 100.0 % Operating income 1,010.7 837.6 173.1 20.7 % % of sales 9.4 % 8.7 % 70 bps The following table presents net sales by geographic region based on product shipment destination (in millions): Year Ended December 31, 2024 2023 Change % Change United States $ 9,001.6 $ 7,830.2 $ 1,171.4 15.0 % Other North America 468.6 386.6 82.0 21.2 % Europe, Africa and Middle East 837.4 948.6 (111.2 ) -11.7 % Rest of the World 422.6 492.5 (69.9 ) -14.2 % Consolidated $ 10,730.2 $ 9,657.9 $ 1,072.3 11.1 % Consolidated sales increased as a result of higher organic volume in all three segments ($544 million), the inclusion of sales related to the AeroTech and AUSA acquisitions ($473 million) and higher pricing ($166 million), partially offset by the impact of the sale of the rear-discharge concrete mixer business ($65 million) and changes in cumulative catch-up adjustments on contracts in the Defense segment ($48 million).
Liquidity Senior Credit Agreement On March 23, 2022, the Company entered into a Third Amended and Restated Credit Agreement (the “Credit Agreement”). The Credit Agreement provides for an unsecured revolving credit facility (the “Revolving Credit Facility”) that matures in March 2027 with an initial maximum aggregate amount of availability of $1.1 billion.
Liquidity Senior Credit Agreement On March 23, 2022, the Company entered into a Third Amended and Restated Credit Agreement (the “Credit Agreement”). The Credit Agreement provides for an unsecured revolving credit facility (the “Revolving Credit Facility”) that matures in March 2027 with an initial maximum aggregate amount of availability of $1.10 billion.
At December 31, 2023, the long-term credit ratings assigned to the Company’s senior debt securities by the credit rating agencies engaged by the Company were as follows: Rating Agency Rating Fitch Ratings BBB Moody’s Investor Services, Inc.
At December 31, 2024, the long-term credit ratings assigned to the Company’s senior debt securities by the credit rating agencies engaged by the Company were as follows: Rating Agency Rating Fitch Ratings BBB Moody’s Investor Services, Inc.
(2) The amounts for purchase obligations included above represent all obligations to purchase goods or services under agreements that are enforceable and legally binding and that specify all significant terms. (3) Represents other long-term liabilities on the Company’s Consolidated Balance Sheet, including the current portion of these liabilities.
(2) The amounts for purchase obligations included above represent all obligations to purchase goods or services under agreements that are enforceable and legally binding and that specify all significant terms. (3) Represents other non-current liabilities on the Company’s Consolidated Balance Sheet, including the current portion of these liabilities.
Due to the difficulty in determining the timing of the settlement, these obligations are not included in the summary of the Company’s fixed contractual obligations. See Note 7 of the Notes to Consolidated Financial Statements for additional information regarding the Company’s unrecognized tax benefits as of December 31, 2023.
Due to the difficulty in determining the timing of such settlements, these obligations are not included in the summary of the Company’s fixed contractual obligations. See Note 7 of the Notes to Consolidated Financial Statements for additional information regarding the Company’s unrecognized tax benefits as of December 31, 2024.
Baa3 Standards & Poor’s BBB Consolidated days sales outstanding (defined as “Trade Receivables” at quarter end divided by “Net Sales” for the most recent quarter multiplied by 90 days) was 44 days at December 31, 2023, down slightly from 45 days at December 31, 2022.
Baa3 Standards & Poor’s BBB Consolidated days sales outstanding (defined as “Trade Receivables” at quarter end divided by “Net Sales” for the most recent quarter multiplied by 90 days) was 40 days at December 31, 2024, down from 44 days at December 31, 2023.
Under the cost-to-cost method of percentage-of-completion, the Defense segment measures progress based on the ratio of costs incurred to date to total estimated costs for the performance obligations. Due to the size and nature of these contracts, the estimation of total revenues and costs is highly complicated and judgmental.
Under the cost-to-cost method of percentage-of-completion, the Defense segment measures progress based on the ratio of costs incurred to date 38 to total estimated costs for the performance obligations. Due to the size and nature of these contracts, the estimation of total revenues and costs is complex and requires judgment by management.
The U.S. Army, which purchased Government Purpose Rights to the Oshkosh JLTV design, conducted a full and open competition for follow-on JLTV production in which Oshkosh Defense participated. In February 2023, the DoD awarded the JLTV follow on contract to another company.
Army, which purchased Government Purpose Rights to the Oshkosh JLTV design, conducted a full and open competition for follow-on JLTV production in which Oshkosh Defense participated. In February 2023, the DoD awarded the JLTV follow-on contract to another company. The Company expects to finish production of domestic JLTVs in early 2025.
Miscellaneous, net includes gains and losses on investments, net foreign currency transaction gains and losses, and non-service costs of the Company’s pension plans. Miscellaneous income, net in fiscal 2023 included a gain on a settlement with the Company's pension advisor ($5 million) and gains on foreign currency transactions ($5 million).
Miscellaneous, net includes gains and losses on investments, net foreign currency transaction gains and losses, and non-service costs of the Company’s pension plans. Miscellaneous income, net decreased primarily due to changes in foreign currency transactions ($8 million) and the recognition of a gain on a settlement with the Company's pension advisor in 2023 ($5 million).
Changes in estimates on contracts accounted for under the cost-to-cost method resulted in cumulative catch-up adjustments on contract margins that increased Defense segment operating income by $5.2 million in fiscal 2023. Changes in estimates on contracts accounted for under the cost-to-cost method decreased Defense segment operating income by $44.9 million in fiscal 2022.
Changes in estimates on contracts accounted for under the cost-to-cost method resulted in cumulative catch-up adjustments on contract margins that decreased Defense segment operating income by $46.9 million in 2024, increased operating income by $2.8 million in 2023 and decreased operating income by $45.7 million in 2022. Goodwill.
The increase in the debt to total capitalization compared to December 31, 2022 was primarily due to the acquisition of AeroTech and corresponding borrowings on the Revolving Credit Facility. 35 The Company’s goal is to maintain an investment-grade credit rating. The rating agencies periodically update the Company’s credit ratings as events or changes in economic conditions occur.
The increase in the debt to total capitalization compared to December 31, 2023 was primarily due to the acquisition of AUSA. The Company’s goal is to maintain an investment-grade credit rating. The rating agencies periodically update the Company’s credit ratings as events or changes in economic conditions occur.
The Company must make assumptions regarding expected increases in wages and employee benefits, productivity and availability of labor, material costs and allocated fixed costs. Each contract is evaluated at contract inception to identify risks and estimate revenue and costs.
The Company must make assumptions regarding expected increases in wages and employee benefits, productivity and availability of labor, material costs and allocated fixed costs, as well as expected impacts on pricing related to certain economic price adjustment clauses. Each contract is evaluated at contract inception to identify risks and estimate revenue and costs.
In addition to cash generated from operations, the Company had other sources of liquidity available at December 31, 2023, including $125.4 million of cash and cash equivalents and $909.2 million of unused available capacity under the Revolving Credit Facility (as defined in “Liquidity”).
In addition to cash generated from operations, the Company had other sources of liquidity available at December 31, 2024, including $204.9 million of cash and cash equivalents and $1.16 billion of unused available capacity under the Revolving Credit Facility (as defined in “Liquidity”).
No other single customer accounted for more than 10% of the Company’s net sales for this period. A substantial majority of the Company’s net sales are derived from the fulfillment of customer orders that are received prior to commencing production.
CUSTOMERS AND BACKLOG Sales to the U.S. government comprised approximately 20% of the Company’s net sales in 2024. No other single customer accounted for more than 10% of the Company’s net sales for this period. A substantial majority of the Company’s net sales are derived from the fulfillment of customer orders that are received prior to commencing production.
Financial Condition at December 31, 2023 The Company’s capitalization was as follows (in millions): December 31, 2023 2022 Cash and cash equivalents $ 125.4 $ 805.9 Total debt 772.5 604.7 Total shareholders’ equity 3,705.3 3,185.7 Total capitalization (debt plus equity) 4,477.8 3,790.4 Debt to total capitalization 17.3 % 16.0 % The Company’s ratio of debt to total capitalization of 17.3% at December 31, 2023 remained within its targeted range.
Financial Condition at December 31, 2024 The Company’s capitalization was as follows (in millions): December 31, 2024 2023 Cash and cash equivalents $ 204.9 $ 125.4 Total debt 961.8 772.5 Total shareholders’ equity 4,152.1 3,705.3 Total capitalization (debt plus equity) 5,113.9 4,477.8 Debt to total capitalization 18.8 % 17.3 % The Company’s ratio of debt to total capitalization of 18.8% at December 31, 2024 remained within its targeted range.
LIQUIDITY AND CAPITAL RESOURCES The Company generates significant capital resources from operating activities, which is the expected primary source of funding for the Company. The Company expects cash flow from operations of approximately $725 million in fiscal 2024.
LIQUIDITY AND CAPITAL RESOURCES The Company generates significant capital resources from operating activities, which is the expected primary source of funding for the Company. The Company expects cash flow from operations to be between $550 million and $650 million in 2025.
Under the “Commander,” “LEKTRO” and "Tempest" brand names, the Company is one of the leading global designers and manufacturers of airport ground support equipment.
Under the “Commander,” “LEKTRO” and "Tempest" brand names, the Company is one of the leading global designers and manufacturers of airport ground support equipment. The Company designs and manufactures Aircraft Rescue and Firefighting (ARFF) vehicles under the “Oshkosh” brand name.
The Company manufactures defense trucks under the “Oshkosh” brand name and is a leading designer and manufacturer of severe-duty, tactical wheeled vehicles for the U.S. Department of Defense (DoD) and other militaries. The Company also designs and manufactures delivery vehicles for the United States Postal Service (USPS) under the “Oshkosh” brand name.
Department of Defense (DoD) and other militaries. The Company also designs and manufactures delivery vehicles for the United States Postal Service (USPS) under the “Oshkosh” brand name.
Major products manufactured and marketed by each of the Company’s business segments are as follows: Access — aerial work platforms and telehandlers used in a wide variety of construction, industrial, institutional and general maintenance applications to position workers and materials at elevated heights, as well as carriers and wreckers.
Major products manufactured and marketed by each of the Company’s business segments are as follows: Access — aerial work platforms and telehandlers used in a wide variety of construction, industrial, agricultural, vegetation management and maintenance applications to position workers and materials at elevated heights. Access customers include equipment rental companies, construction contractors, manufacturing companies and home improvement centers.
The table below presents a reconciliation of the Company’s presented non-GAAP measure to the most directly comparable GAAP measure: Fiscal 2024 Expectations Earnings per share-diluted (GAAP) $ 9.45 Amortization of purchased intangibles 0.80 Adjusted earnings per share-diluted (non-GAAP) $ 10.25
The table below presents a reconciliation of the Company’s presented non-GAAP measure to the most directly comparable GAAP measure: 2025 Expectations Earnings per share-diluted (GAAP) $ 10.30 Amortization of purchased intangibles, net of tax 0.70 Adjusted earnings per share-diluted (non-GAAP) $ 11.00 40
Consolidated days payables outstanding (defined as “Accounts Payable” at quarter end divided by material costs of sales for the most recent quarter multiplied by 90 days) was 72 days, up from 66 days at December 31, 2022, primarily due to the timing of cash disbursements.
Consolidated days payables outstanding (defined as “Accounts Payable” at quarter end divided by material costs of sales for the most recent quarter multiplied by 90 days) was 65 days, down from 72 days at December 31, 2023, primarily due to the timing of cash disbursements. 36 Operating Cash Flows Operating activities provided $550.1 million of cash in 2024 compared to $599.6 million in 2023.
The projected timing of cash flows associated with these obligations is based on management’s estimates, which are based largely on historical experience. This amount also includes all liabilities under the Company’s pension and other postretirement benefit plans.
The projected timing of cash flows associated with these obligations is based on management’s estimates, which are based largely on historical experience. This amount also includes all liabilities under the Company’s pension and other post-employment benefit plans. See Note 6 of the Notes to Consolidated Financial Statements for information regarding these liabilities and the plan assets available to satisfy them.
Aviation ground support products, gate equipment and airport services provided to commercial airlines, airports, air-freight carriers, ground handling customers and the military. Front-discharge concrete mixers sold to ready-mix companies. Field service vehicles and truck-mounted cranes sold to mining, construction and other companies.
Vocational — custom and commercial firefighting vehicles and equipment; aviation ground support products, gate equipment and airport services provided to commercial airlines, airports, air-freight carriers, ground handling customers and the military; aircraft rescue and firefighting (ARFF) vehicles; refuse and recycling collection vehicles sold to commercial and municipal waste haulers; field service vehicles and truck-mounted cranes sold to mining, construction and other companies; simulators, mobile command and control vehicles and other emergency vehicles primarily sold to fire departments, airports and other governmental units and front-discharge concrete mixers sold to ready-mix companies.
The following table presents consolidated non-operating changes (in millions): Year Ended December 31, 2023 2022 Change Interest expense, net of interest income $ (53.8 ) $ (43.9 ) $ (9.9 ) Miscellaneous, net 13.8 (52.8 ) 66.6 Provision for income taxes 190.0 97.5 92.5 Effective tax rate 23.8 % 35.4 % Gains (losses) of unconsolidated affiliates $ (9.6 ) $ (4.2 ) $ (5.4 ) Interest expense, net of interest income increased in fiscal 2023 due to increased borrowings on the Company's revolving credit facility and lower cash holdings as a result of the acquisition of AeroTech.
The following table presents consolidated non-operating changes (in millions): Year Ended December 31, 2024 2023 Change Interest expense, net of interest income $ (111.9 ) $ (53.8 ) $ (58.1 ) Miscellaneous, net 4.2 13.8 (9.6 ) Provision for income taxes 210.0 190.0 20.0 Effective tax rate 23.3 % 23.8 % Losses of unconsolidated affiliates $ (11.6 ) $ (9.6 ) $ (2.0 ) Interest expense, net of interest income increased due to increased borrowings on the Revolving Credit Facility (as defined in "Liquidity") primarily to fund the acquisitions of AeroTech in August 2023 and AUSA in September 2024.
Under the “Pierce” and "Maxi-Metal" brand names, the Company is among the leading global designers and manufacturers of fire trucks assembled on both custom and commercial chassis. Under the “Frontline” brand name, the Company is a leading domestic designer, manufacturer and marketer of command vehicles.
Under the “Pierce” and "Maxi-Metal" brand names, the Company is among the leading global designers and manufacturers of municipal fire trucks assembled on both custom and commercial chassis. Under the “Jetway,” brand name, the Company is one of the leading global designers and manufacturers of aircraft passenger boarding bridges.
The Company continues to actively monitor its liquidity position and working capital needs and prioritizes debt repayment, capital expenditures related to capacity and strategic investments. The Company remains in a stable overall capital resources and liquidity position that the Company believes is adequate to meet its projected needs. Other uses of cash include the repurchase of the Company’s Common Stock.
The Company continues to actively monitor its liquidity position and working capital needs and prioritizes capital expenditures related to capacity and strategic investments. The Company believes that its liquidity position is adequate to meet its projected needs.
The Company's Board of Directors authorized the repurchase of 12 million shares in May 2022, of which approximately 11.3 million shares remained as of December 31, 2023. In fiscal 2022, the Company repurchased 1,508,467 shares at an aggregate cost of $155.0 million.
The Company's Board of Directors authorized the repurchase of 12 million shares in May 2022, of which approximately 10.2 million shares remained as of December 31, 2024. In 2023, the Company repurchased 265,795 shares of its Common Stock at an aggregate cost of $22.5 million.
Backlog represents the dollar amount of revenues that the Company anticipates from customer contracts that have been awarded and/or are in progress. Reported backlog includes the original contract amount and any contract modifications that have been agreed upon. Reported backlog excludes purchase options, announced orders for which definitive contracts have not been executed and any potential future contract modifications.
Reported backlog includes the original contract amount and any contract modifications that have been agreed upon. Reported backlog excludes purchase options, orders for which definitive contracts have not been executed and any potential future contract modifications. Backlog is comprised of fixed and variable priced contracts that may be canceled, modified or otherwise changed in the future.
The Company expects Vocational segment operating margin in fiscal 2024 will be in the range of 9.4% as compared to 7.2% in fiscal 2023. The segment's operating income margin is expected to increase in 2024 as municipal customer orders in backlog for delivery in fiscal 2024 were booked at significantly higher prices.
The segment's operating margin is expected to increase in 2025 as a result of expected continued favorable price/cost dynamics. Customer orders in backlog for delivery in 2025 were booked at significantly higher prices. 31 The Company expects Defense segment sales will be approximately $2.3 billion in 2025, an increase of approximately 7% compared to 2024 sales.
The Company was in compliance with the financial covenant contained in the Credit Agreement as of December 31, 2023 and expects to be able to meet the financial covenant contained in the Credit Agreement over the next twelve months.
The Company was in compliance with the financial covenant contained in the Credit Agreement as of December 31, 2024 and expects to be able to meet the financial covenant contained in the Credit Agreement over the next twelve months. 37 Senior Notes In May 2018, the Company issued $300.0 million of 4.60% unsecured senior notes due May 15, 2028 (the “2028 Senior Notes”).
The Company recognizes changes in estimated sales or costs and the resulting profit or loss on a cumulative basis. In addition, as contract modifications (e.g., new orders) are received, they are evaluated to determine if they represent a separate contract or a modification of the existing contract.
In addition, as contract modifications (e.g., new orders) are received, they are evaluated to determine if they represent a separate contract or a modification of the existing contract. As of December 31, 2024, the estimated remaining costs on the NGDV and FMTV A2 contracts represent the majority of the total estimated costs to complete in the Defense segment.
Days sales outstanding for segments other than the Defense segment was 49 days at both December 31, 2023 and 2022. Consolidated inventory turns (defined as “Cost of Sales” on an annualized basis, divided by the average “Inventory” at the past five quarter end periods) increased slightly from 4.1 times at December 31, 2022 to 4.2 times at December 31, 2023.
Consolidated inventory turns (defined as “Cost of Sales” on an annualized basis, divided by the average “Inventory” at the past five quarter end periods) decreased from 4.2 times at December 31, 2023 to 3.9 times at December 31, 2024, primarily due to increases in inventory levels in the Vocational and Access segments.
At December 31, 2023, borrowings under the 36 Revolving Credit Facility of $175.0 million and outstanding letters of credit of $15.8 million reduced available capacity under the Revolving Credit Facility to $909.2 million.
At December 31, 2024, borrowings under the Revolving Credit Facility of $360.0 million and specified outstanding letters of credit of $26.3 million reduced available capacity under the Revolving Credit Facility to $1.16 billion.
The Company believes excluding the impact of these items is useful to investors to allow a more accurate comparison of the Company’s operating performance to prior year results. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company’s results or forecasts prepared in accordance with GAAP.
Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company’s results or forecasts prepared in accordance with GAAP.
Gains and losses of unconsolidated affiliates primarily represented changes in the Company’s equity method investments. During the first quarter of fiscal 2023, the Company wrote down its investment in an equity interest in an entity in Mexico by $6 million based on the estimated fair market value of the entity.
During 2023, the Company wrote down its investment in an equity interest in an entity in Mexico by $6 million based on the estimated fair market value of the entity and subsequently completed the sale of its interest in the entity, resulting in an additional loss of $2 million.
Refer to Note 16 of the Notes to Consolidated Financial Statements for additional information regarding the Company’s debt as of December 31, 2023. Contractual Obligations The total amount of gross unrecognized tax benefits, including interest, for uncertain tax positions was $73.6 million as of December 31, 2023. Payment of these obligations would result from settlements with tax authorities.
Contractual Obligations The total amount of gross unrecognized tax benefits, including interest, for uncertain tax positions was $61.6 million as of December 31, 2024. Future settlements with tax authorities could result in payment of these obligations.
The increase in Access segment operating income was primarily due to improved pricing ($239 million), the impact of higher gross margin associated with higher sales volume ($181 million), improved sales mix ($65 million) and lower material & logistics costs ($30 million), offset in part by higher incentive compensation costs ($49 million) and increased operating expenses to support higher sales levels ($38 million).
The increase in Access segment operating income was primarily due to improved sales mix ($48 million), the impact of higher gross margin associated with higher sales volume ($33 million), favorable absorption ($15 million) and lower litigation costs ($10 million), offset in part by higher selling, general and administrative expenses to support higher sales volume ($24 million) and higher engineering costs ($21 million).
NEW ACCOUNTING STANDARDS See Note 2 of the Notes to Consolidated Financial Statements regarding the impact or potential impact of recent accounting pronouncements on the Company’s consolidated financial statements. CUSTOMERS AND BACKLOG Sales to the U.S. government comprised approximately 19% of the Company’s net sales in fiscal 2023.
See Note 12 of the Notes to Consolidated Financial Statements for information regarding the Company’s goodwill. NEW ACCOUNTING STANDARDS See Note 2 of the Notes to Consolidated Financial Statements regarding the impact or potential impact of recent accounting pronouncements on the Company’s consolidated financial statements.
Backlog is comprised of fixed and variable priced contracts that may be canceled, modified or otherwise changed in the future. As a result, backlog may not be indicative of future operating results. Backlog information and comparisons thereof as of different dates may not be accurate indicators of future sales.
As a result, backlog may not be indicative of future operating results. Backlog information and comparisons thereof as of different dates may not be accurate indicators of future sales. Approximately 53% of the Company’s December 31, 2024 backlog is not expected to be filled in 2025.
Following is a summary of the Company’s contractual obligations and payments due by period following December 31, 2023 (in millions): Payments Due by Period Less Than More Than Total 1 Year 1-3 Years 3-5 Years 5 Years Long-term debt (including interest) (1) $ 717.6 $ 23.1 $ 46.2 $ 337.5 $ 310.8 Lease obligations 315.8 66.1 95.5 65.5 88.7 Purchase obligations (2) 2,426.2 2,281.1 144.6 0.1 0.4 Other long-term liabilities (3) 325.1 52.8 82.6 49.3 140.4 $ 3,784.7 $ 2,423.1 $ 368.9 $ 452.4 $ 540.3 (1) Interest was calculated based upon the interest rate in effect on December 31, 2023.
Following is a summary of the Company’s contractual obligations and payments due by period following December 31, 2024 (in millions): Payments Due by Period Less Than More Than Total 1 Year 1-3 Years 3-5 Years 5 Years Long-term debt (including interest) (1) $ 699.7 $ 25.4 $ 47.2 $ 324.3 $ 302.8 Lease obligations 301.5 67.8 99.3 67.4 67.0 Purchase obligations (2) 2,169.4 2,096.3 73.1 — — Other non-current liabilities (3) 440.0 47.6 79.3 52.2 260.9 $ 3,610.6 $ 2,237.1 $ 298.9 $ 443.9 $ 630.7 (1) Interest was calculated based upon the interest rate in effect on December 31, 2024.
Changes in estimates on contracts accounted for under the cost-to-cost method resulted in cumulative catch-up adjustments on contract margins that increased Defense segment operating income by $5.2 million in fiscal 2023 and decreased Defense segment operating income by $44.9 million in fiscal 2022. Fair Value of Intangible Assets.
Changes in estimates on contracts accounted for under the cost-to-cost method resulted in cumulative catch-up adjustments on contract margins that decreased Defense segment operating income by $46.9 million in 2024 primarily as a result of significant costs to prepare units for acceptance and receiving orders that required loss reserves.
The increase in Vocational segment selling, general and administrative expenses was generally a result of the inclusion of operating costs related to AeroTech ($27 million), the loss on the sale of the rear discharge concrete mixer business ($13 million), acquisition costs related to AeroTech ($13 million) and higher incentive compensation costs ($11 million).
The increase in Vocational segment selling, general and administrative expenses was generally a result of incremental operating costs related to the timing of the AeroTech acquisition ($48 million), offset in part by the absence of the loss on the sale of the rear-discharge concrete mixer business ($13 million), the absence of acquisition costs related to AeroTech ($13 million) and net gains related to the sale of its sales and service locations to dealers in conjunction with its change to a dealer network in North America ($8 million).
The Company designs and manufactures Aircraft Rescue and Firefighting (ARFF) vehicles under the “Oshkosh” brand name. Under the “McNeilus” brand name, the Company designs and manufactures a wide range of automated, rear, front, side and top loading refuse collection vehicles. Under the “Oshkosh” brand name, the Company designs and manufactures front-discharge concrete mixers.
Under the “McNeilus” brand name, the Company designs and manufactures a wide range of automated, rear, front, side and top loading refuse and recycling collection vehicles. Under the “IMT” brand name, the Company is a leading domestic designer and manufacturer of field service vehicles and truck-mounted cranes.
The increase in gross margin in the Vocational segment was primarily attributable to improved pricing (480 basis points), offset in part by higher material costs (270 basis points) and higher production costs (80 basis points).
The increase in gross margin in the Vocational segment was primarily attributable to improved pricing.
The Company’s backlog as of December 31, 2023 increased 18.8% to $16.8 billion compared to $14.1 billion at December 31, 2022. Access segment backlog increased 3.9% to $4.5 billion at December 31, 2023, compared to $4.4 billion at December 31, 2022, primarily due to higher pricing.
The Company’s backlog as of December 31, 2024 decreased 12.0% to $14.74 billion compared to $16.75 billion at December 31, 2023. Access segment backlog decreased 59.5% to $1.83 billion at December 31, 2024, compared to $4.53 billion at December 31, 2023.
Vocational The following table presents the Commercial segment results (in millions): Year Ended December 31, 2023 2022 Change % Change Net sales $ 2,578.1 $ 2,175.7 $ 402.4 18.5 % Cost of sales 2,143.2 1,842.2 301.0 16.3 % Gross income 434.9 333.5 101.4 30.4 % % of sales 16.9 % 15.3 % 160 bps SG&A expenses 230.6 171.9 58.7 34.1 % Amortization 18.8 5.1 13.7 268.6 % Impairment charge — 2.1 (2.1 ) -100.0 % Operating income 185.5 154.4 31.1 20.1 % % of sales 7.2 % 7.1 % 10 bps Vocational segment net sales increased as a result of the inclusion of sales related to acquisitions ($292 million) and higher pricing in response to higher input costs ($161 million), offset in part by the impact of the sale of the rear discharge concrete mixer business in the first quarter of fiscal 2023 ($79 million).
Vocational The following table presents the Vocational segment results (in millions): Year Ended December 31, 2024 2023 Change % Change Net sales $ 3,310.3 $ 2,578.1 $ 732.2 28.4 % Cost of sales 2,630.7 2,143.2 487.5 22.7 % Gross income 679.6 434.9 244.7 56.3 % % of sales 20.5 % 16.9 % 360 bps Selling, general and administrative 242.8 230.6 12.2 5.3 % Amortization of purchased intangibles 39.7 18.8 20.9 111.2 % Operating income 397.1 185.5 211.6 114.1 % % of sales 12.0 % 7.2 % 480 bps Vocational segment sales increased due to the timing of the AeroTech acquisition ($429 million), improved organic sales volume ($212 million) and improved pricing in response to higher input costs ($160 million), offset in part by the impact of the sale of the rear-discharge concrete mixer business in the first quarter of 2023 ($65 million).
The increase in Access segment selling, general and administrative expenses was generally a result of higher incentive compensation costs ($25 million), increased information technology costs ($13 million), higher product liability costs ($10 million), increased advertising costs ($8 million) and the inclusion of operating costs related to Hinowa ($4 million).
The increase in Access segment selling, general and administrative expenses was generally a result of higher spending on outside services ($16 million), higher salaries ($11 million) and the inclusion of operating costs related to AUSA ($4 million), offset in part by lower incentive compensation costs ($8 million). Amortization of purchased intangible assets increased primarily due to the acquisition of AUSA.
The 2028 Senior Notes and the 2030 Senior Notes were issued pursuant to an indenture (the “Indenture”) between the Company and a trustee. The Indenture contains customary affirmative and negative covenants. The Company has the option to redeem the 2028 and 2030 Senior Notes at any time for a premium.
In February 2020, the Company issued $300.0 million of 3.10% unsecured senior notes due March 1, 2030 (the “2030 Senior Notes”). The 2028 Senior Notes and the 2030 Senior Notes were issued pursuant to an indenture (the “Indenture”) between the Company and a trustee. The Indenture contains customary affirmative and negative covenants.
The increase in operating income in the Vocational segment was primarily due to improved pricing ($161 million), offset in part by higher material costs ($69 million), higher incentive compensation costs ($21 million), higher production costs ($21 million), the loss on the sale of the rear discharge concrete mixer business ($13 million) and acquisition costs related to AeroTech ($13 million). 34 Corporate and Intersegment eliminations The following table presents the corporate costs and intersegment eliminations (in millions): Year Ended December 31, 2023 2022 Change % Change Net sales $ (8.4 ) $ (7.1 ) $ (1.3 ) -18.3 % Cost of sales 10.0 1.7 8.3 488.2 % Gross income (18.4 ) (8.8 ) (9.6 ) -109.1 % Operating expenses 159.9 132.7 27.2 20.5 % Operating income (178.3 ) (141.5 ) (36.8 ) -26.0 % Corporate cost of sales increased primarily as a result of higher engineering and new product development costs ($5 million) and higher incentive compensation costs ($4 million).
The increase in operating income in the Vocational segment was primarily due to improved pricing ($160 million), the impact of higher gross margin associated with higher sales volume ($55 million), improved product mix ($31 million), the absence of the loss on the sale of the rear-discharge concrete mixer business ($13 million) and the absence of acquisition costs related to AeroTech ($13 million), offset in part by higher material costs ($25 million) and adverse production variances ($25 million). 34 Defense The following table presents the Defense segment results (in millions): Year Ended December 31, 2024 2023 Change % Change Net sales $ 2,155.2 $ 2,001.4 $ 153.8 7.7 % Cost of sales 1,996.1 1,805.4 190.7 10.6 % Gross income 159.1 196.0 (36.9 ) -18.8 % % of sales 7.4 % 9.8 % -240 bps Selling, general and administrative 107.7 108.3 (0.6 ) -0.6 % Operating income 51.4 87.7 (36.3 ) -41.4 % % of sales 2.4 % 4.4 % -200 bps Defense segment sales increased primarily due to higher volume ($202 million), partially offset by unfavorable cumulative catch-up adjustments in 2024 compared to favorable cumulative catch-up adjustments in 2023 ($48 million).
FISCAL 2024 OUTLOOK The Company estimates consolidated net sales will be in the range of $10.4 billion in fiscal 2024, compared to $9.7 billion in fiscal 2023. The Company expects consolidated operating income will be in the range of $925 million, resulting in diluted earnings per share in the range of $9.45.
This was the Company’s eleventh straight year of a double-digit percentage increase to its dividend rate. 2025 OUTLOOK The Company estimates consolidated sales will be approximately $10.6 billion in 2025, compared to $10.7 billion in 2024. The Company expects consolidated operating income will be approximately $990 million, resulting in diluted earnings per share of approximately $10.30.
Approximately 50% of the Company’s December 31, 2023 backlog is not expected to be filled in fiscal 2024. NON-GAAP FINANCIAL MEASURES The Company is forecasting earnings per share excluding items that affect comparability. When the Company forecasts earnings per share, excluding items, this is considered a non-GAAP financial measure.
NON-GAAP FINANCIAL MEASURES The Company is forecasting earnings per share excluding items that affect comparability. When the Company forecasts earnings per share, excluding items, this is considered a non-GAAP financial measure. The Company believes excluding the impact of these items is useful to investors to allow a more accurate comparison of the Company’s operating performance to prior year results.
The increase in consolidated operating income was primarily due to improved price ($401 million), the impact of higher gross margin associated with higher sales volume ($138 million), improved sales mix ($112 million) and the absence of unfavorable cumulative catch-up adjustments on contracts in the Defense segment ($45 million), offset in part by higher incentive compensation costs ($110 million), higher manufacturing costs ($49 million) and increased operating expenses to support higher sales levels in the Access segment ($38 million).
The increase in consolidated operating income was primarily due to improved pricing ($166 million), the impact of higher gross margin associated with higher sales volume ($134 million) and improved sales mix ($63 million), partially offset by intangible asset impairments ($52 million), the impact of changes in cumulative catch-up adjustments on contracts ($50 million), higher engineering costs ($47 million) and higher production costs ($43 million).
In performing this evaluation, the Defense segment considers risks of contract performance such as technical requirements, schedule, duration and key contract dependencies. These considerations are then factored into the Company’s estimated revenue and costs. If a loss is expected on a performance obligation, the complete estimated loss is recorded in the period in which the loss is identified.
If a loss is expected on a performance obligation, the complete estimated loss is recorded in the period in which the loss is identified. Preliminary contract estimates are subject to change throughout the duration of the contract as additional information becomes available that impacts risks and estimated revenue and costs.
Included in the Company's expectations is amortization of intangible assets of approximately $65 million, or $0.80 per share. Excluding amortization of intangible assets, the Company expects adjusted diluted earnings per share to be in the range of $10.25.
Included in the Company's expectations is amortization of intangible assets of approximately $60 million, or $0.70 per share. Excluding amortization of intangible assets, the Company expects adjusted diluted earnings per share to be approximately $11.00. The Company's estimates assume that present levels of tariff rates, raw material prices and supply chain performance continue into 2025 without significant disruption.
The Company estimates the tax rate for fiscal 2024 will be approximately 24.5% and the average share count will be approximately 66.2 million shares. The Company expects consolidated net sales in the first quarter of fiscal 2024 to be in the range of $2.5 billion, consistent with the fourth quarter of fiscal 2023.
The Company estimates net interest expense will be approximately $120 million in 2025, compared to $112 million in 2024. The Company estimates the tax rate for 2025 will be approximately 23.5% and the average share count will be approximately 65.0 million shares.
The decrease in Defense segment selling, general and administrative expenses was primarily due to a gain on the sale of the Company's snow removal apparatus business ($8 million), offset in part by higher incentive compensation costs ($6 million).
The increase in consolidated selling, general and administrative expenses was primarily a result of operating costs related to acquired businesses ($52 million), offset in part by lower incentive compensation costs ($14 million).
The Company expects Defense segment operating margin will be in the range of 2.1% in fiscal 2024, down from 4.4% in fiscal 2023. The Company expects unfavorable product mix and NGDV-related start-up costs to account for the lower operating margin in fiscal 2024 as compared to fiscal 2023.
The Company expects Defense segment operating margin will be approximately 4.0% in 2025, compared to 2.4% in 2024, as a result of lower adverse cumulative catch-up adjustments and the ramp-up of NGDV production. The Company estimates corporate and other costs in 2025 will be approximately $185 million.
JLTV accounted for sales of $0.98 billion in fiscal 2023. 33 The increase in gross margin in the Defense segment was due to changes in cumulative catch-up adjustments on contracts (200 basis points) and lower new product development expenses (80 basis points), offset in part by higher inventory obsolescence reserves (40 basis points).
The increase in consolidated gross margin was due to improved pricing (120 basis points), offset in part by changes in cumulative catch-up adjustments on contracts in the Defense segment (50 basis points).
The increase in operating income in the Defense segment was primarily a result of the absence of unfavorable cumulative catch-up adjustments on contract margins ($45 million), lower new product development expense ($17 million) and a gain on the sale of the Company's snow removal apparatus business ($8 million), offset in part by lower gross margin associated with lower sales volume ($12 million), higher incentive compensation costs ($11 million) and higher inventory obsolescence reserves ($9 million).
The decrease in operating income in the Defense segment was primarily a result of the impact of changes in cumulative catch-up adjustments on contracts ($50 million) and adverse production variances ($15 million), offset in part by the impact of higher gross margin associated with higher sales volume ($30 million).
Income tax expense in fiscal 2022 included a charge of $31.3 million as the Company revised its interpretation of certain foreign anti-hybrid tax legislation based upon comments from the corresponding taxing authorities. See Note 7 of the Notes to Consolidated Financial Statements for a reconciliation of the effective tax rate compared to the U.S. statutory tax rate.
The lower effective tax rate in 2024 as compared to 2023 is the result of a higher foreign-derived intangible income deduction due to higher export sales. See Note 7 of the Notes to Consolidated Financial Statements for a reconciliation of the effective tax rate compared to the U.S. statutory tax rate.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS GENERAL Oshkosh Corporation is an innovative industrial company focused on the design, development and manufacture of purpose-built vehicles and equipment that enhance safety, maximize productivity, lower total cost of ownership and simplify fleet management to support those who perform some of the most difficult jobs in the world.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS GENERAL Oshkosh Corporation is a global industrial technology company dedicated to moving the world forward. As an innovator and integrator, we specialize in the design, development and manufacturing of purpose-built vehicles and equipment, serving everyday heroes.
Access products are sold to equipment rental companies, construction contractors, manufacturing companies, home improvement centers and towing companies. Defense — tactical vehicles, trailers, weapons system integration and parts sold to the U.S. military and to other militaries around the world and delivery vehicles for the USPS.
Defense — tactical vehicles, trailers, weapons system integration and parts sold to the U.S. military and to other militaries around the world and delivery vehicles for the United States Postal Service (USPS). All estimates referred to in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” refer to the Company’s estimates as of February 20, 2025.
The Company completed the sale of its interest in the entity during the third quarter of fiscal 2023, resulting in an additional loss of $2 million. 32 SEGMENT RESULTS Access The following table presents the Access segment results (in millions): Year Ended December 31, 2023 2022 Change % Change Net sales $ 4,990.0 $ 3,972.1 $ 1,017.9 25.6 % Cost of sales 3,954.0 3,432.2 521.8 15.2 % Gross income 1,036.0 539.9 496.1 91.9 % % of sales 20.8 % 13.6 % 720 bps SG&A expenses 288.6 226.3 62.3 27.5 % Amortization 8.6 0.4 8.2 2050.0 % Operating income 738.8 313.2 425.6 135.9 % % of sales 14.8 % 7.9 % 690 bps Access segment net sales increased as a result of improved sales volume ($703 million) as supply chain improvements supported higher production levels, higher pricing in response to higher input costs ($239 million) and the inclusion of sales related to the Hinowa acquisition ($73 million).
SEGMENT RESULTS Access The following table presents the Access segment results (in millions): Year Ended December 31, 2024 2023 Change % Change Net sales $ 5,164.7 $ 4,990.0 $ 174.7 3.5 % Cost of sales 4,035.9 3,954.0 81.9 2.1 % Gross income 1,128.8 1,036.0 92.8 9.0 % % of sales 21.9 % 20.8 % 110 bps Selling, general and administrative 312.7 288.6 24.1 8.4 % Amortization of purchased intangibles 10.7 8.6 2.1 24.4 % Operating income 805.4 738.8 66.6 9.0 % % of sales 15.6 % 14.8 % 80 bps 33 Access segment sales increased primarily as a result of improved sales volume in North America ($277 million) and the inclusion of sales related to the AUSA acquisition ($44 million), offset in part by lower sales volume in the Europe, Africa and Middle East ($103 million) and Rest of the World ($43 million) regions.
The Company expects Vocational segment net sales will be in the range of $3.1 billion in fiscal 2024, an increase of 20% compared to the fiscal 2023 net sales. The Company’s expectation reflects the full year benefit of the AeroTech acquisition, which is expected to contribute approximately $420 million of incremental sales versus fiscal 2023.
The Company expects Vocational segment sales of approximately $3.8 billion in 2025, an increase of approximately 15% compared to 2024 sales reflecting expected increases in production volume and pricing. The Company expects Vocational segment operating margin in 2025 will be approximately 14.0%, compared to 12.0% in 2024.
Vocational segment backlog increased 58.4% to $5.5 billion at December 31, 2023, compared to $3.5 billion at December 31, 2022, due to strong demand for fire apparatus coming out of the COVID-19 pandemic, increased pricing and the inclusion of AeroTech backlog of $775.5 million.
The decrease in backlog is believed to primarily be the result of the normalization of orders in connection with improved product availability and slowing demand in North America. Vocational segment backlog increased 15.6% to $6.32 billion at December 31, 2024, compared to $5.46 billion at December 31, 2023, due to strong demand for municipal fire apparatus and price increases.
Removed
Under the “IMT” brand name, the Company is a leading domestic designer and manufacturer of field service vehicles and truck-mounted cranes. Under the “Jetway,” brand name, the Company is one of the leading global designers and manufacturers of aircraft passenger boarding bridges.
Added
The Company is an innovator, developing and leveraging disruptive technologies across our portfolio in the areas of electrification, autonomy and connectivity, making some of the most challenging jobs in the world safe, smart, connected, quiet, clean and productive — delivering both efficiency and impact.
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Vocational — custom and commercial firefighting vehicles and equipment, aircraft rescue and firefighting (ARFF) vehicles, simulators, mobile command and control vehicles and other emergency vehicles primarily sold to fire departments, airports and other governmental units. Refuse collection vehicles sold to commercial and municipal waste haulers.
Added
Under the “Frontline” brand name, the Company is a leading domestic designer, manufacturer and marketer of command vehicles. Under the “Oshkosh” brand name, the Company designs and manufactures front-discharge concrete mixers. The Company manufactures defense trucks under the “Oshkosh” brand name and is a leading designer and manufacturer of severe-duty, tactical wheeled vehicles for the U.S.
Removed
All estimates referred to in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” refer to the Company’s estimates as of February 29, 2024. BASIS OF PRESENTATION In October 2021, the Company’s changed its fiscal year end from September 30 to December 31.
Added
The Access segment also manufactures carriers and wreckers sold to towing companies.
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Accordingly, the Company reported a transition quarter that ran from October 1, 2021 through December 31, 2021. Fiscal 2021 relates to the year ended September 30, 2021. Fiscal 2022 and 2023 relate to the years ended December 31, 2022 and December 31, 2023, respectively.
Added
BASIS OF PRESENTATION In July 2024, the Company moved the reporting responsibility for Pratt Miller from its Defense segment to the Chief Technology and Strategic Sourcing Officer to better utilize Pratt Miller’s expertise across the entire Oshkosh Corporation enterprise.
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OVERVIEW Fiscal 2023 was a very successful year for the Company, with growth in revenue, operating income and diluted earnings per share. Results for fiscal 2023 significantly exceeded our initial expectations for the year as the Company's initial guidance reflected modest supply chain improvements, which were expected to limit revenues and contribute to production 29 inefficiencies.
Added
Pratt Miller results are now reported within "Corporate and other." All historical information has been recast to reflect this change. 30 OVERVIEW The Company delivered another successful year in 2024, demonstrating significant progress in its strategy to drive meaningful growth across the Company's businesses and to position Oshkosh for long-term success and shareholder value creation.
Removed
Continued improvements in supply chain conditions, actions the Company has taken to improve production resiliency in a constrained supply environment, improved sales mix and disciplined pricing helped the Company achieve the improved performance. The Company also completed the strategic acquisitions of JBT AeroTech (AeroTech) and Hinowa S.p.A. (Hinowa).
Added
Net sales grew in each of the Company's segments during the year, led by the Vocational segment. The Company also significantly improved profitability during the year, delivering operating income of $1.01 billion, or 9.4% of sales, in 2024, compared to $0.84 billion, or 8.7% of sales, in 2023. Diluted earnings per share also increased 14% to $10.35 per share.
Removed
These acquisitions advance our purpose — to make a difference in the lives of those who build, serve and protect communities across the globe. Our acquisitions also broaden the end markets that we serve. In particular, we have increased our participation in the attractive air transportation support market with the AeroTech acquisition, an industry with strong secular growth projections.
Added
The Company's success in 2024 was also highlighted by its progress on strategic priorities, each of which advances the Company's purpose — to make a difference in the lives of those who build, serve and protect communities across the globe.
Removed
The Company has also made targeted investments in manufacturing capacity in order to meet the growing needs of our customers in the future. During the year, we made significant progress in preparing for the start of production of the Next Generation Delivery Vehicles (NGDV) for the USPS in April 2024.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeThe Company’s operating results are principally exposed to changes in exchange rates between the U.S. dollar and the European currencies, primarily the Euro and the U.K. pound sterling, changes between the U.S. dollar and the Australian dollar, changes between the U.S. dollar and the Mexican peso, changes between the U.S. dollar and the Chinese renminbi and changes between the U.S. dollar and the Canadian dollar. 42
Biggest changeThe Company’s operating results are principally exposed to changes in exchange rates between the U.S. dollar and Euro, British pound sterling, Australian dollar, Mexican peso, Chinese renminbi and Canadian dollar. 41
In addition, the Company is a purchaser of components and parts containing various commodities, including steel, aluminum, rubber and others which are integrated into the Company’s end products. The Company generally buys these commodities and components based upon market prices that are established with the vendor as part of the purchase process.
In addition, the Company is a purchaser of components and parts containing various commodities, including steel, aluminum, rubber and others which are integrated into the Company’s end products. The Company generally buys these commodities and components based upon market prices that are established with the vendor as part of the purchasing process.
The majority of export sales in fiscal 2023 were denominated in U.S. dollars. As a result of the manufacture and sale of the Company’s products in foreign markets, the Company’s earnings are affected by fluctuations in the value of foreign currencies in which certain of the Company’s transactions are denominated as compared to the value of the U.S. dollar.
The majority of export sales in 2024 were denominated in U.S. dollars. As a result of the manufacture and sale of the Company’s products in foreign markets, the Company’s earnings are affected by fluctuations in the value of foreign currencies in which certain of the Company’s transactions are denominated as compared to the value of the U.S. dollar.
ITEM 7A. QUANTITATIVE AND QUALITA TIVE DISCLOSURES ABOUT MARKET RISK The Company is exposed to market risk from changes in interest rates, certain commodity prices and foreign currency exchange rates. To reduce the risk from changes in foreign currency exchange and interest rates, the Company selectively uses 41 financial instruments.
ITEM 7A. QUANTITATIVE AND QUALITA TIVE DISCLOSURES ABOUT MARKET RISK The Company is exposed to market risk from changes in interest rates, certain commodity prices and foreign currency exchange rates. To mitigate the risk from changes in foreign currency exchange and interest rates, the Company selectively uses financial instruments.
In this regard, changes in U.S. and offshore interest rates affect interest payable on the Company’s borrowings under its Credit Agreement. The Company had variable rate-based debt of $175.0 million outstanding on its Revolving Credit Facility at December 31, 2023 with an interest rate of 6.6%.
In this regard, changes in U.S. and offshore interest rates affect interest payable on the Company’s borrowings under the Credit Agreement. The Company had variable rate-based debt of $360.0 million outstanding on its Revolving Credit Facility at December 31, 2024 with an interest rate of 5.6%.
The Company’s operations consist of manufacturing in the U.S., Mexico, Canada, France, Australia, the United Kingdom, Italy and China and sales and limited vehicle body mounting activities on five continents. International sales comprised approximately 17% of overall net sales in fiscal 2023, of which approximately 46% involved exports from the U.S.
The Company’s operations consist of manufacturing in the U.S., Mexico, Canada, France, Australia, the United Kingdom, Italy, Spain and China and sales and limited vehicle body mounting activities on five continents. International sales comprised approximately 14% of overall net sales in 2024, of which approximately 40% involved exports from the U.S.

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