as a result of the economy as well as low truck demand and weak freight volumes.
The company saw truck segment sales of $321 million, down 49 percent from the second quarter of 2008. Production in this segment fell 33 percent, with U.S. markets and non-U.S. markets are down 43 percent and 22 percent, respectively. Eaton posted an operating loss of $3 million in the sector.
"We expect production in the second half to be broadly similar to the first half," said Alexander Cutler, Eaton chairman and chief executive officer. "The key factors inhibiting demand for trucks appear to be weak freight volumes and limitations on financing. It is unclear when these conditions will improve. At this point, for all of 2009, we anticipate our truck markets will decline by 27 percent."
The company's overall sales and income didn't fare well either. Net income for the second quarter was $29 million, a 92 percent loss from the same quarter in 2008, when net income was $333 million. Sales came out to $2.9 billion, down 32 percent from the second quarter of 2008. These numbers include charges for integration of acquisitions, the company says.
"Our sales in the second quarter were only slightly higher than in the first quarter of 2009, reflecting little improvement in the challenging global economic conditions," Cutler said. "Despite the sluggish revenues, which came in $100 million lower than projected in our initial quarterly guidance, we were successful in substantially lowering our cost structure, which allowed us to generate earnings about equal to our guidance for the quarter."